New Globalization Battle Threatens Asia

The world today must confront a new economic policy conundrum: national governments doubting the benefits of cross-border mergers and acquisitions on the one hand, and the forces of economic globalization driving such partnerships on the other. The battle, already waged in Europe and the US, has now migrated to Asia. As global industry restructures, three major factors frame the conflict over globalization: First, fears about job loss have expanded from low-skill workers to professionals. White-collar workers, once outspoken champions of globalization when they thought there was nothing to lose, have joined the blue-collar workers in lashing out against globalization. As a result, globalization could lose some of its most vocal supporters. Second, governments fear cross-border restructuring not only because of job loss itself, but also because of the potential loss of brainpower. The combination of white-collar workers switching sides on the globalization issue and governments’ new prerogative to prevent “brain-drain” could become a formidable threat to globalization. Governments and citizens also fear that some mergers could threaten national security. For example, the US quickly rallied to oppose a Dubai firm’s proposal to manage operations of six US ports. The new reluctance emerges just when many of Asia’s most promising companies plan to go multinational. Asian firms could find themselves at a huge disadvantage, if the EU and the US block their expansion plans and deny them markets. Government leaders of all countries need to understand the anxiety that accompanies rapid change, and find innovative ways to distribute the benefits of globalization fairly among citizens, both within nations and throughout the world. – YaleGlobal