In 1974, the UN General Assembly adopted a declaration for a New International Economic Order (NIEO) that called for new rules for global trade, finance and resource ownership. Global South countries had asked for these rules because they wanted a global economy that also worked for them. Within ten years, Global North states had blocked the main proposals, and debt crises took the wind out of the declaration.
Subtopic 7.4 examines what Global South countries and their allies have tried since then. You will start with the NIEO’s proposals and learn why it collapsed. You will look at the case for reparations for transatlantic slavery, and at the objections to it. You will study proposals to change the rules of global tax, debt and finance, and the new institutions that Global South countries have built. You will see why trade liberalisation, the removal of trade barriers, hurt many local producers, and how regional trade agreements try to help small economies. You will look at South-South cooperation, which means cooperation between Global South countries, in areas such as health, digital systems and technology. You will ask when this cooperation is mutual and when one partner dominates. You will study how countries and communities govern shared ecological systems that no single country controls. You will also see what small-scale programmes, such as cash transfers, can and cannot do. The subtopic ends with the importance of sovereignty over food, energy and manufacturing.
Each of these efforts has limits. Powerful states have blocked some proposals. Some new institutions are still small. Some cooperation between Global South countries has repeated the imbalances it aimed to reduce. Results also differ between countries and regions. Self-determination is necessary for regenerative global exchange, but it does not guarantee that ecosystems are protected or that people inside each country share the gains.
At the end of Subtopic 7.4 you should be able to:
explain how the ideas and demands of the New International Economic Order emerged and why it collapsed
evaluate the claim that self-determination is necessary, but not sufficient, for regenerative global exchange
explain the proposals and case for reparations for transatlantic slavery, as well as the objections and responses
describe the different alternatives Global South countries have built to existing global financial institutions, across tax governance, development finance, and debt
discuss the extent to which these alternatives shift real power away from existing institutions
explain why industrial policy has been central to the development of Global North countries and China, and why many Global South countries face structural barriers to using the same tools
compare at least two Global South-led alternatives to trade liberalisation and assess what each contributes to the challenge of structural economic transformation
explain how South-South cooperation in areas such as medical training, digital infrastructure, technology transfer, and political coordination aims to reduce Global South dependence on Global North markets, finance, and technology
evaluate whether a specific South-South cooperation arrangement functions as horizontal exchange or new hegemony, using evidence of capacity, interests, voice, profit, and exit
explain why governing shared ecological systems at large scales is more difficult than governing local commons, including the concepts of collective action problems, free-rider problems, power asymmetry, and state capture
evaluate the effectiveness of international and regional approaches to governing shared ecological systems
explain the role of randomised controlled trials in development economics
evaluate the evidence on micro-interventions such as cash transfers, distinguishing between their measurable local effects and their ability to address the structural conditions that produce poverty
explain how food, energy and manufacturing deficits keep countries dependent on imports and limit progress on the SDGs
evaluate the extent to which sovereignty over food, energy and manufacturing can meet people's needs within planetary boundaries.