The "New Economic Order" - No more multilateralism

 

The liberal order is dead according to The Economist. The new economic order is completely different with sanctions, tariffs, and restrictions of trade and capital flows. No more world organization supporting free trade and the rule of law. It is more every nation for itself in this chaotic order. The multilateral thinking is dead as countries form bilateral links. 

Sanction have become the norm not the exception, yet these sanctions are often ineffective and create a chaotic system based on changing alliances and not economic efficiency. 

Tariffs have increased under the Biden administration after their use under Trump. Local politics drive decisions, not consumer welfare.

Capital controls and restrictions which limits potential buyers is also the norm, and regulations are placing barriers upon activity across borders. Costs go up and economic efficiency goes down.

The power of international organization has declined and the use of international courts to solve disputes have fallen. The WTO does not solve trade problem in a timely manner or at all.

Simply put, this world order driven by the United States and international organizations like the IMF and World Bank is a thing of the past. Now, some of this order needed reforming but a new world of bilateralism and regional coalitions will not support greater global trade nor raise global income. Delinking will reduce market price correlations.