Wednesday November 29, 2023

Western financial imperialism: A new way of colonisation-I

May 22, 2023

West is clinging to imperial instinct. They are not ready to let the world enjoy freedom, prosperity and human dignity. They know imperialistic behaviour provided basis for their modern empires. It is not fiction or allegation.

It is a well-documented fact they built their empires with the resources of Asian, African, Pacific and South American countries. Rough estimates suggest British Empire alone stolen around $45 trillion from Sub-Continent by imposing anti-human regime. It is almost half of the today’s global GDP.

They turned one of the resource-rich and prosper societies into backward country. It resulted in widespread poverty and food insecurity in the region. Simultaneously, European invaders turned resource rich Africa into slave market.

History tells us Western imperialists committed widespread atrocities in Asia, Africa and Americas. They even did not hesitate in enslaving people and committing genocides. For example, modern America is built on the blood of indigenous people. The suffering of Aboriginals of Australia is another story to tell. They are still facing cruelty and injustice. They faced, and are facing all types of brutalities. They were stripped off human status and were given numbers like animals.

Despite such plunder and brutalities, Western imperialists do not regret it, rather celebrate it. To cover their crimes, they have invented new slogans and instruments. They are cheating world by acting as defender of human rights and values.

They have started presenting themselves as great defender of human values. As, there is a saying in Aboriginal community, grandparents committed crimes against humanity, robbed their resources, and now grandsons are busy in creating noble image of their grandparents. They are telling stories of greatness of their grandparents and their love for humanity.

In reality, they only have washed their bloody hands. The instinct to exploit and enslave people, however, is very much there. They want to continue plunder, one way or the other, because they know they cannot sustain their lifestyle without plundering.

However, since the World War-II, they realised they cannot continue physical occupation or colonisation of countries and plundering of their resources. Hence, they adopted a new policy and came up with new means of colonisation. It was not a choice, but need of the time, as countries have started to revolt. Freedom movements got momentum and European illegal occupiers had to flee the countries.

In this backdrop, Western imperialists shortlisted culture, education and financial system as new means to colonise a country. Though, they applied these tools simultaneously, the financial mechanisms were kept at the top of the list.

It gave birth to multilateral financial institutions like Bretton Wood Institutions (World Bank, International Monetary Fund). They also created political institutions like United Nations etc. to assist financial institutions in their endeavour to build financial empires.

Bretton Wood Institutions were given task to control the financial system of the world. The US and UK put all efforts to ensure their supremacy, which is evident from the dialogue between Harry White and John Keynes. However, the US won due to its enormous power and abundant resources at that time. Although, these institutions were presented as democratic institutions, the West kept control in their hands by devising new instruments of influence.

They consolidated their control through allocation of quota which determines the financial obligation and voting power of the countries. For example, formula for the calculation of quota for IMF was based on GDP, openness, variability and reserves, and each indicator was given weight of 0.50, 0.30, 0.15, 0.05 respectively.

Western countries knew Asian, African and many South American nations do not have resources, as these have already been plundered. So, these countries would not be able to contribute much. As a result, they will not be able to get votes.

The US, being the biggest country at that time, kept maximum votes for itself. According to official website of IMF, US enjoys 16.50 percent of voting rights. So, for any major decision, it is necessary that US agrees to the decision. 85 percent votes are needed for any major decision. This number cannot be achieved even if the whole world comes together, except the US.

In lateral words, the US has veto power. It also enjoys this power at the World Bank with 15.45 percent votes. Simultaneously, the US and allies are not allowing meaningful reforms after 2010.

They fear China and emerging economies will get more votes according to the formula of IMF and the World Bank. It will undermine their hegemonic position which they do not want at all. As a result, China, second largest economy and biggest trader of world, has less votes than that of Japan.

Apart from the Bretton Wood Institutions, West, especially United Kingdom and US, are also controlling global financial markets by using hegemony on transaction and strength of US dollar. There is no second opinion about the fact the US and UK are the major clearing houses for international transactions. On the other hand, US dollar is a leading currency for global trade invoicing, which it is exploiting to maximum.

(To be continued)