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Reviewing the world economic model

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The newly elected President of Argentina, Javier Milei, promises to smash orthodox economic models in Argentina. He vowed to cancel a slew of government ministries, departments and agencies, including the Central Bank of Argentina.

Kenyan President William Ruto, who wonders why Africans must use the dollar for intra-African trade, says, “From Djibouti, selling to Kenya, or traders from Kenya selling to Djibouti, we have to look for US dollars. How is US dollars part of the trade between Djibouti and Kenya?”

He adds, “That is why Kenya champions the Pan African Payment and Settlement System that is done by our own institution — the Afreximbank… Why is it necessary for us to buy things from Djibouti and pay in dollars?”

Proof that the world is taking note and acting on this argument is in the fact that China, the world’s second-biggest economy, initiated a Yuan-Naira payment arrangement for trade with Nigeria.

This international payment option will bypass the Belgium-based Society for Worldwide Interbank Financial Telecommunications system, operated by G-10 Nations to power global money and security transfers.

Russia, warring with Ukraine, its former client state, now insists on receiving its currency, the ruble, for the gas it sells to (especially) the Western European members of the North Atlantic Treaty Organisation military alliance.

The blurb of Thomas Pakenham’s “The Scramble for Africa,” a historical account of how the West took over the fortunes of Africa, observes that, “Europe was experiencing a period of economic stagnation (in the closing years of the 19th Century) and (thought that) Black Africa might be… an El Dorado, a new market and tropical treasure.”

Pakenham stated that the missionary, explorer and medical doctor, David Livingstone, had suggested ‘the 3 Cs,’ of commerce, Christianity and civilisation, which he cynically interpreted as “a triple alliance of Mammon, God and social progress,” as a remedy for the blight of slavery and slave trade in Africa.

Livingstone’s conclusion that “trade, not the gun, would liberate Africa,” is just a pacifist route for Western nations to rule the economy of Africa.

GlaxoSmithKline Beecham is vacating Nigeria which no longer serves its commercial purpose.

Dr Patrick Lumumba, lawyer, social activist and former Director of Kenya School of Law and the Kenya Anti-Corruption Commission, probably a motivational speaker to African politicians, has urged Africans to define their terms of economic and political engagement with the world.

Maybe Milei, who vows to dollarise Argentina’s economy, is cynically pointing out that the metropolitan economies have become so dominant that peripheral economies may have no need for their own currencies. By the way, the Argentine peso bears the American dollar sign.

Dollarisation will mean either the substitution or simultaneous use of the dollar with the currency of Argentina, the largest debtor of the International Monetary Fund, with a killing 143 per cent inflation rate.

It looks like the people of Argentina, their Western economic policy advisers and the rest of the world will see even more iconoclastic policies from the oxymoron in the radical, yet far-right, Milei.

Anyone who knows the workings of capitalist economics and can read economic trends knows that beyond becoming “flat,” the world and its increasingly interdependent economy will sooner or later be ruled by a single leviathan that operates from wherever the international monopoly capital chooses between New York, Beijing, London, Berlin or Tokyo, or even Pretoria.

Japanese business consultant, Kenichi Ohmae, has shown how cross-border businesses almost no longer have national addresses but take up an amorphous identity as it becomes more difficult to classify the legal residency of their ubiquitous international monopoly capital owners.

Ohmae says: “National borders are now irrelevant to most companies and consumers, regardless of whether they are in Japan, North America, or Europe. Current frictions and clashes at the national level may seem serious, but they are insignificant at the microeconomic level where customers buy and companies sell.”

The first place to look into for the tendency that the world’s economies may eventually merge into one is the consumerist outlook of the “glocal” citizens, the ultimate cosmopolitans, who dress, look, speak and exhibit the Western materialistic attitude wherever they are resident in the world.

Ohmae adds: “Americans are eager to buy (Japanese) Sony Walkmans and wear (Italian) Benetton sweaters. Like other cosmopolitan consumers in advanced industrial countries, they acknowledge the value of good products and buy them, regardless of their country of origin.”

If you took this “one-world” idea to the ridiculous, even bizarre, extent, you would have observed that striptease dancing, cross-dressing, even the LGBTQ syndrome and the biologically ridiculous idea of a transgender are trending throughout the metropolitan and peripheral nations!

Another evidence of the “one-world” trend is the global brands and the multinational corporations that manufacture, market, distribute and advertise them. Nearly everyone in the world today knows and craves one global brand or the other.

Again Ohmae points to an irony that hits the West: “The (now materialistic) Japanese (consumers) are not aware of contributing to imports when they drink the products made by Coca-Cola, nor do they feel any duty to drink a Japanese brand instead….

“They pay no attention to the fact… that Coca-Cola is an American company, or that Kleenex tissues are made in Japan by a joint venture that is 50 per cent American-owned. Schick has the largest share of the Japanese market for razor blades, but Japanese men don’t feel they have jilted the leading domestic (razor blade) brand!”

These global brands include European football teams and fast-moving consumer goods, like dresses, accessories, shoes, personal hygiene products, wines, beers, and quick-service restaurants, like Kentucky Fried Chicken, Domino’s Pizza and Nando’s.

But how all these work, almost like one big orchestra, to impose one culture and one economic model on the whole world, is the more intriguing part: Finance, technology and marketing communications are the nodal nexus in this intricate loop.

Yet the workings of the mechanism of Western capitalism have an inherent problem. By continuously adding layers of costs on a product, as it travels throughout the labyrinth of the market, a product acquires added costs that are almost irreversible.

It may be difficult to replace this cost-loading template that has permeated even into the communist systems (run by Communist China under Chairman Mao), and the Union of Soviet Socialist Republics (spearheaded by Lenin)!

Today, China and Russia are leading capitalist economies, even if communism and socialism are tucked in somewhere in the formal posturing of their Marxist political literature and economic theories.

The hypocritical USSR, under Stalin, appointed Dr Amanda Hammer, whose father emigrated from Russia to America, to establish Occidental Oil company, to handle Soviet Union trade in petroleum, gold and mink, with capitalist economies of the West.

The Minister of Finance, Wale Edun, who is also the Co-ordinating Minister of the Economy, needs to assemble economic theorists, corporate players and entrepreneurs, to review Nigeria’s current economic template and design a new one.

 Just as Western democracy is not quite working out for Africa, as former President Olusegun Obasanjo and former Ekiti State Governor, Kayode Fayemi, have observed, the spiralling cost-loading template of the West is also not working for Africa.

Nigeria must evolve an economic template that works for it, and halt the hand-me-down template that holds its economy down for the West to exploit.

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