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Yaroslav Lissovolik

Chief Managing Director of Sberbank, Head of analytical Department of global markets Sberbank Investment Research, RIAC Member

One of the dimensions in the reform of global governance and the role of the United Nations is a rebalancing of global development priorities towards human capital development. Perhaps one of the key lessons from the current crisis is that finance is not the sole prerogative of global governance, and that the center of gravity in international cooperation needs to shift towards human development capabilities, including in the sphere of healthcare, writes Yaroslav Lissovolik, Programme Director of the Valdai Discussion Club.

One of the dimensions in the reform of global governance and the role of the United Nations is a rebalancing of global development priorities towards human capital development. Perhaps one of the key lessons from the current crisis is that finance is not the sole prerogative of global governance, and that the center of gravity in international cooperation needs to shift towards human development capabilities, including in the sphere of healthcare, writes Yaroslav Lissovolik, Programme Director of the Valdai Discussion Club.

I think God’s going to come down and pull civilization over for speeding. – Stephen Wright

A civilization is built on what is required of men, not on that which is provided to them – Antoine de Saint-Exupéry

The severity of the current crisis is likely to lead the global community to re-think some of the fundamental values and priorities in such areas as security, welfare and governance. With respect to security the realization may be that it is a much broader category than “military security” per se, with health and environment becoming increasingly more important factors. Welfare for its part is not solely about income and the scale of economic growth, while global governance should not be obsessed exclusively with finance. This value shift that will likely emerge in the wake of the current crisis will necessitate a reassessment of priorities in the future evolution of global governance as well as its current institutional setup.

In fact, one may argue that there are several crucial failures in the current system of global governance that exacerbated the depth of the current crisis. First and foremost, the current crisis represents a grand failure of Realpolitik and policies of narrow self-interest. The global governance system whether at the level of international institutions, regional blocs or countries has largely proven disorganized and ineffective in mustering a strong response to the current crisis. Secondly, there needs to be a reassessment of priorities towards addressing the global undersupply of public goods, particularly to services related to human capital development – as I noted in last year’s Valdai Club article published by the World Economic Forum (WEF), “the UN Development goals, most notably those pertaining to human capital development, need to be accorded greater weight” within the framework of global governance.

To address the gaps in global governance related to human capital development what may be needed is a functional layer for global organizations, which could include international organizations that cover all key areas pertaining to global risks. This includes the World Health Organization to deal with the risks of pandemics, the International Organization for Migration (IOM) to facilitate international cooperation in the area of cross-border movement of people, as well as international bodies that would also target such issues as cyber-security as well as ecological problems such as global warming. These international organizations just like the IMF and other Bretton Woods organizations need to be equipped with professionals who monitor risks at the international level and can be deployed at the country level to work towards lowering the systemic risks at hand.

Given the difficulties, including severe budget constraints, that are likely to be experienced by the global economy in the post-crisis setting in creating new international organizations, a significant part of the institutional adjustment will need to be borne by the United Nations. As we approach the 75th anniversary of the United Nations the current crisis reveals the need to bolster international cooperation through a reinvigoration of the UN. This should involve greater connectivity of the UN with regional institutions as well as the functional layer of organizations that target the mitigation of systemic risks to health, cybersecurity and the environment.

Greater international cooperation will also necessitate greater balance in decision-making bodies across countries and regions, most notably with respect to UN governing structures such as the UN Security Council. This may raise the need for reforming the UN Security Council in the direction of greater inclusivity via incorporating regional bodies or representations of regions/continents. The first step may be an extended UN Security Council format that includes a consultative platform for the regional/transregional alliances of current Security Council members. The platform of regional arrangements could focus on non-military issues pertaining to international security, including cyber-security, energy security, as well as common response across regions to pandemics.

One possible format may involve the EU (covering France and, only to a degree, the UK), BRICS (Russia, China) and the North American USMCA alliance. This framework effectively involves most of the G20 countries into discussions on global security issues. The next step may involve an extension in the coverage of the regional platform to include other regional blocks (BRICS+, as well as possibly TPP and other mega-blocs). In the longer term the representation in the regional platform and the Security Council may be increasingly linked to the geographic/continental principle , within which dispassionate geography rather than impassioned power politics will be the determining factor of representation.

The regional extension of the UN Security Council may be the gateway to building a more inclusive and comprehensive global security system. The rationale for such an extended framework is further reinforced by the progression of continental integration across all continents and major regions of the globe (including in Eurasia, with important integration projects such as SCO and the BRI). Furthermore, the current composition of the Security Council is already structured along regional lines, with non-permanent members distributed along the geographical principle to include Africa and Asia (5), Eastern Europe (1), Latin America (2), Western Europe and other states (2).

Ultimately, the current set-up of the Security Council cannot be seen as being fully in line with the longer-term exigencies of world security and inclusivity. The present UN Security Council structure is not only archaic, but is also skewed towards power politics and reflects de facto a selection of the world’s leading nuclear powers. Yet, the events of this year associated with the outbreak of the pandemic point clearly to the fact that global security is not just about who controls nuclear warheads. As non-nuclear and non-military security issues take on greater prominence on the global scene and as they increasingly overshadow the issue of militaristic competition, the older nucleus of the UN Security Council will be gradually superseded in importance by the broader platform of regions and continents deciding on a range of broader issues that require cross-country and cross-regional cooperation in the sphere of international security.

A further dimension in the reform of global governance and the role of the United Nations is a rebalancing of global development priorities towards human capital development. Perhaps one of the key lessons from the current crisis is that finance is not the sole prerogative of global governance, and that the center of gravity in international cooperation needs to shift towards human development capabilities, including in the sphere of healthcare. The UN will likely be the key agent of this change in working together with the Bretton Woods institutions as well as WHO, IOM and other global organizations to achieve these goals. These shifts in priorities at the macro level of countries and global governance also need to take place and to some degree are already happening at the microlevel of companies. In the end, a rebalancing of the architecture of international institutions as well as development priorities is long overdue as the frequency and intensity of crises afflicting the global economy throughout the past decade clearly signals that “business as usual” is headed towards a dead-end.


Source: Valdai

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