Trade and Conflict

Trends in Economic Nationalism, Unilateralism and Protectionism

Samuel MacIsaac, Buck Duclos, Samuel MacIsaac, Buck Duclos

• Publisher: Routledge
• Year: 2022
• eBook ISBN: 9781000541670
• Topic: Politics & International Relations
• Subtopic: Politics
• Index: Politics & International Relations

This book aims to reframe the broader debate on the recent globalization backlash and its implications for middle-powers such as Canada.

Protectionists have been accused of unraveling the multilateralist world order. The United States pulling out of the Trans-Pacific Partnership Agreement, the renegotiation of the North American Free Trade Agreement, and a series of tariffs imposed by both the United States and China threaten global economic integration. Fierce protectionist rhetoric risks gridlocking a fragile trade system that faces rising discontent, especially in light of the recent globalization backlash. American geopolitical hostilities are also influencing trade policies, notably punitive tariff and trade sanctions. Meanwhile, these fears are not limited to trade. The ongoing challenge to American hegemony and rising globalization backlash are dangerous signals of economic unpredictability that could perilously escalate towards outright conflict. This edited volume, then, tackles the trends of rising economic nationalism, unilateralism and protectionism to shed light on these vital foreign policy issues.

The chapters in this book were originally published as a special issue of the Canadian Foreign Policy Journal.

Rival economic nationalisms: Brexit and the Scottish independence movement compared

X. Hubert Rioux

ABSTRACTThe recent resurgence of economic nationalism, protectionism, and “authoritarian capitalism” has been polymorphic and contradictory. Moves away from multilateralism have often been justified by pleas in favor of “free but fair” trade, and bilateral liberalization. Britain is a particularly interesting case. Among the paradoxes having surrounded the Brexit process, one stands out which underlines another manifestation of this polymorphism: the Scottish government (SG) has indeed announced its intention to hold a second referendum on independence in the wake of Brexit , which is illustrative of the wider dynamism of regionalism and secessionism. As Britain is trying to regain some autonomy from the European Union (EU) therefore, internal challenges to its sovereignty are also intensifying. Yet, so far, mainstream Brexiteers’ and Scottish nationalists’ pursuit of economic autonomy has had little to do with autarky. Both movements, therefore, highlight the fact that economic nationalism should not be reduced to protectionism. Although they are opposed in their stances towards the EU, mainstream proponents of Brexit and of Scotland’s independence indeed share relatively similar (yet largely incompatible) objectives: that of diversifying their country’s commercial relations, and that of regaining control over economic policy through enhanced autonomy from specific political ensembles.

RÉSUMÉLa récente résurgence du nationalisme économique, du protectionnisme et du « capitalisme autoritaire » a été polymorphe et contradictoire. L'abandon du multilatéralisme a souvent été justifié par des plaidoyers favorables au commerce « libre mais équitable », et à une libéralisation bilatérale. La Grande-Bretagne est un cas particulièrement intéressant. Parmi les paradoxes qui ont entouré le processus du Brexit, il en est un qui souligne une autre manifestation de ce polymorphisme : le gouvernement écossais a en effet annoncé son intention d'organiser un second référendum sur l'indépendance dans le sillage du Brexit, ce qui illustre le dynamisme plus large du régionalisme et du sécessionnisme. Par conséquent, alors que la Grande-Bretagne tente de retrouver une certaine autonomie par rapport à l'Union européenne (UE), les défis internes à sa souveraineté s'intensifient également. Pourtant, jusqu'ici, la poursuite de l'autonomie économique par les partisans du Brexit et les nationalistes écossais n'a guère eu de rapport avec l'autarcie. Ainsi, les deux mouvements mettent l'accent sur le fait que le nationalisme économique ne doit pas être réduit au protectionnisme. Bien qu'ils soient opposés dans leur position vis-à-vis de l'UE, les principaux partisans du Brexit et de l'indépendance écossaise partagent en effet des objectifs fortement semblables (mais largement incompatibles) : celui de diversifier les relations commerciales de leur pays, comme celui de reprendre le contrôle de la politique économique grâce à une autonomie renforcée vis-à-vis d'ensembles politiques spécifiques.

The recent resurgence of economic nationalism, protectionism, and “authoritarian capitalism” has been polymorphic and contradictory (Carney 2018, Clift and Woll 2015, D’Costa 2012, Evenett and Fritz 2015, National Board of Trade 2016). Moves away from multilateralism have often been justified by pleas in favor of “free but fair” trade, and bilateral liberalization. Britain is a particularly interesting case: among the paradoxes having surrounded the Brexit process (Clarke et al. 2017, Curtice 2016, Gamble 2018, Schimmelfennig 2018), one stands out which underlines another manifestation of this polymorphism: the Scottish government (SG) has indeed announced its intention to hold a second referendum on independence in the wake of Brexit,¹ which is illustrative of the wider dynamism of regionalism and secessionism (Bélanger et al. 2018, Boylan 2015, De La Calle and Fazi 2010, Gray 2015, Hepburn 2008). As Britain is trying to regain some autonomy from the European Union (EU) therefore, internal challenges to its sovereignty are also intensifying (Keating 2018, Sloat 2018). Yet, so far, mainstream Brexiteers’ and Scottish nationalists’ pursuit of economic autonomy has had little to do with autarky. Both movements, therefore, highlight the fact that economic nationalism should not be reduced to protectionism (Boulanger 2006, Helleiner and Pickel 2005).

Although they are opposed in their stances towards the EU, mainstream proponents of Brexit and of Scotland’s independence indeed share relatively similar (yet largely incompatible) objectives: that of diversifying their country’s commercial relations, and that of regaining control over economic policy through enhanced autonomy from specific political ensembles. Both movements are also facing similar difficulties. On the one hand, and aside from a small group of radical “maximalists” – sometimes referred to as the “Little Englanders” – who would like to cut most ties with the EU and resort to protectionism (Gamble 2018, 5), Brexiteers have mostly been trying to safeguard the United Kingdom’s (U.K.) trade relations with the EU while deconstructing the political and regulatory edifice surrounding them. That has proved easier said than done (Schimmelfennig 2018). On the other hand, Scottish nationalists would like to see Scotland partly emancipated from its deep commercial and political dependency towards Britain, therefore seeking to reinforce its ties to the EU (SG 2018a, 2018b, 2019). This, however, is proving trickier now that the U.K. is withdrawing from the EU and that, therefore, Scotland’s secession followed by EU membership could mean the erection of trade barriers with the rest of Britain, by far Scotland’s most important export market (Kalafsky and Brown 2018, Rioux 2019b).

The case of Brexit Britain, in sum, provides important material for the study of liberal economic nationalisms and the difficulties such movements encounter, at national and regional scales, in the “selective reduction of a state’s level and scope of integration” with other specific states or unions, what Schimmelfennig calls “differentiated disintegration” (2018, p. 1154). The aims of this article, accordingly, are twofold. First, we evaluate how Brexit compares to the wider trends of resurging economic nationalism gaining ground elsewhere, and some of the difficulties the movement is facing in its pursuit of “differentiated disintegration” from the EU. To that end, we draw from a literature corpus which distinguishes economic nationalism from protectionism and insists that the former is not incompatible with liberal trade policies (Helleiner and Pickel 2005, Boulanger 2006, Fougner 2006). More specifically, we adopt a “nationalist” perspective on international political economy (Abdelal 2001, p. 36) which focuses on economic nationalism’s “directionality,” namely on the idea that governments can seek autonomy from specific states or unions while liberalizing their trade relationships with others. That is what Brexit Britain illustrates: while one nationalist movement is leading a withdrawal from the EU, notably to gain the autonomy needed to deepen the U.K.’s trade relationships with other international partners, another is seeking to preserve and widen Scotland’s ties to Europe, notably in order to facilitate its secession from the U.K.

In the second part of the article, we focus on this Scottish independence movement. We first provide an overview of the ways in which Scottish nationalists’ perspectives on European integration and international trade have evolved, adapting to circumstances and opportunities (Imrie 2006, Dmitrieva 2008, Tarditi 2010, Hepburn and McLoughlin 2011). We then investigate major commercial debates having surrounded the September 2014 referendum on Scotland’s independence (Goudie 2013, McHarg et al. 2016, Keating 2017), and finally we analyze the ways in which Brexit has affected and might continue to impact the objectives and strategies of the Scottish independence movement with regards to trade and European membership (Hassan and Gunson 2017). Our conclusion is that Brexit and the Scottish independence movement are indicative, ultimately, not of a backlash against liberalization or integration per se, but of obstacle-ridden attempts to reclaim the means for more selective approaches to liberalization and integration to global markets and value chains (Ijtsma et al. 2018, Kalafsky and Brown 2018). In this sense, Brexit Britain provides a number of important lessons with regards to the current resurgence of economic nationalism.

What is Brexit a case of?

Among the main variables which drove the Brexit vote and movement so far are economic Euroscepticism, and English nationalism. The results of the June 2016 referendum were the culmination of many decades of rising Euroscepticism in the U.K., most recently fueled by key junctures such as Britain’s exit from the Exchange Rate Mechanism in 1992, the Treaty of Maastricht, the Treaty of Lisbon, and of course the successive financial, debt, and migration crises having plagued the EU from 2008 to 2015 (Bulmer and Quaglia 2018, Gamble 2018, Hobolt 2018). Opinion polls, and notably the longstanding “British Social Attitudes” survey have indeed identified peaks in Euroscepticism – the opinion according to which “Britain’s long-term policy should be to leave the EU, or to stay in the EU and try to reduce the EU’s powers” – following these junctures, in the wider context of a general progression of such stances since the early 1990s.

The history of Euroscepticism in the U.K. can be traced back to the very infancy of the European Economic Community in the 1950s, but hostility towards European integration really picked up steam in the late-1980s and early-1990s, “in light of EU spillover towards monetary union and social policy” (Bulmer and Quaglia 2018, pp. 1090–1091). In 1992, Eurosceptic attitudes were shared by 40% of the population in the U.K.; by 1996, this proportion had reached 58%. By 2012, it has reached a new peak of 67% and never receded under 60% afterwards (Curtice 2016, p. 211). The timing of these surges indicates a correlation between deepening European integration and Euroscepticism. British views of the EU’s economic effects on the U.K. followed a very similar path (Curtice 2016, p. 213): in 1990, only around 45% thought that EU membership was either weakening (8%) the British economy or making no difference (37%); by 1995, 59% were of the former (20%) or latter (39%) opinion. This proportion also never retreated below 50% since, so that by 2015, 58% of the population considered the EU to be weakening the U.K.’s economy (18%) or to have no effect on it (40%). Yet, some have questioned the centrality of economic considerations in explaini...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• Citation Information
• Notes on Contributors
• Introduction: Trade and conflict: trends in economic nationalism, unilateralism and protectionism
• 1 Rival economic nationalisms:
• 2 Sino-Canadian relations in the age of Justin Trudeau
• 3 Trade, conflict, and opportunity: taking advantage of others’ protectionism and isolationism – the case of MERCOSUL
• 4 NAFTA renegotiations and support for Canada-China FTA
• 5 Conflict in the absence of war: a comparative analysis of China and Russia engagement in gray zone conflicts
• 6 Canada’s quixotic foreign policy in the shifting global landscape
• 7 A skeletal review of the Sino-U.S. “trade war”: contentious issues, trade multilateralism and policy recommendations
• Index