We are one

Deborah Harrison/ getty images

"If 1989 saw the end of the 'Second World' with Communism's demise, then 2009 saw the end of what was known as the 'Third World.' We are now in a new, fast-evolving multi-polar world economy in which some developing countries are emerging as economic powers, others are moving towards becoming additional poles of growth, and some are struggling to attain their potential within this new system -- where North and South, East and West, are now points on a compass, not economic destinies," said Robert B Zoellick, the President of World Bank (WB).
In a speech ahead of the spring meeting of the WB, Zoellick said that the global economic crisis of 2009 and the rise of developing countries in the global economy were the death-knell of the old concept of the Third World as a separate entity just as 1989 was for the Second World of communism. This has profound implications for a multi-polar world.
Zoellick, in his speech entitled "The end of the Third World? Modernising multi-lateralism for a Multipolar World," also said: "Poverty remains and must be addressed. Failed states remain and must be addressed. Global challenges are intensifying and must be addressed. But the manner in which we must address these issues is shifting. The out- dated categorisations of First and Third Worlds, donor and supplicant, leader and led, no longer fit."
These remarks were welcomed by activist groups who have long campaigned for a greater voice for developing countries in the institutions that oversee the world economy. The proclamation of the end of Third World is in fact an acknowledgement, a rather belated one, because of the fact that the geopolitical configuration of the world has totally changed from what it was in 1944, when the Breton Woods system was introduced. And the advocacy of modernising multi-lateralism for a multi-polar world has focused on the urgent need of reforming the WB and IMF.
The WB president has forcefully drawn world's attention to the prevailing mismatch between the world economy and the emerging geopolitics. He recalled Woodrow Wilson's "words on paper did not realise their lofty ideals" in the League of Nations as it was practically formed and run. He noted: "Arranging a new sharing of responsibilities among mutual stakeholders in international systems will not be easy." "But happen it must,: he insisted. Otherwise, the world will be in danger.
The concept of Third World arose during the Cold War to define countries that were not aligned with either capitalism and Nato -- which along with its allies represented the First World -- or communism and the Soviet Union -- which along with its allies represented the Second World. This definition provided a way of broadly categorising the nations of the earth into three groups based on social, political, and economic divisions.
Although the term Third World continues to be used colloquially to describe the poorest countries in the world, this usage is widely disparaged since the term no longer holds any verifiable meaning after the fall of the Soviet Union deprecated the terms First World and Second World. However, there are still scholars who use this term on purpose to point out and challenge the huge gap between the poor and the rich of the world.
The validity of the term Third World has been placed in question over the past decade with the increasingly acknowledged "West-to-East" economic power shift. The old concept of the Third World no longer applies in the new multi-polar world, and new approaches are needed to take account for the interests of developing countries.
The developing countries are growing to represent an ever-increasing share of the global economy and providing an important source of demand for the recovery from the recent global economic crisis.
The First World is poised to decline with global economic power shifting from the West to East. According to the latest predictions of the Conference Board, a global network of leading business figures, the next few years will witness a dramatic acceleration in the shift of economic power eastwards.
The Board said that the global economy would expand by 3.5 percent in 2010 and the emerging and developing economics would account for a much larger share of the global pie -- as much as two-thirds by 2016.
This was occurring not only in China and India, but also in South East Asia, Latin America, and the Middle East. Africa could also one day become a pole of global growth. Zoellick noted that developing countries, therefore, deserved greater recognition in the management of the global system and that proposed solutions in financial regulation, climate change and crisis management must reflect their interests.
Indeed, Zoellick noted that Asia's stock markets accounted for 32 percent of global market capitalisation, ahead of both the US and the European Union, and that its share of the global economy in purchasing power parity (PPP) terms had risen from 7 percent 30 years ago to 21 percent in 2008.
The developing world's share of global GDP has increased from 33.7 percent in 1980 to 43.4 percent in 2010. Developing countries are likely to show robust growth rates over the next five years and beyond.
The changes in the global economy and multilateral system have significant implications for the WB and IMF. The WB and IMF must pursue a policy of constant reform, changing to adapt to rapidly shifting circumstances in order to best serve the interests of the poor in the developing world. 'Economic and political tectonic plates are shifting," Zoellick noted, and added: "We can shift with them."
Since the establishment of the WB in 1946, its presidents have all along been the White House's choice, with Europe always choosing the IMF heads -- which is undemocratic.
In a reflection of the growing shift in world economic growth and power, China and India increased their voting rights in the WB with China rising up to third place and India to seventh place. Only the US and Japan are now ahead of China, while Germany, France and UK are those left with more voting rights than India.
With the present world order remaining unchanged, a multi-polar world is not possible. The development committee of the WB, which met on April 25 in Washington, however, decided to increase the financial capacity of the WB and its governance structure as a sign of support for the shift in influence to developing countries. The WB and IMF must be made democratic for facing the challenges of the multi-polar world.

A.N.M. Nurul Haque is a columnist of The Daily Star.
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