The world has had a prolonged peace after World War-2. Of course it had a war of spies, proxy wars, small time dictators, space race, nuclear race, regime changes, Hollywood and the real war of posturing between the United States of America and the Soviet Union.

The Cold War unfortunately ended with a whimper and gave rise to the era of globalization, which itself has ended with Trump’s tariffs coming into effect. By the end of this article one will learn from our argument that the world is going to see changes like no other and new alliances will be formed to stay relevant in the global economy. As we explain the evolution of the global south and north, we will also tell you how it is going to be different for everyone of us in this new global order as corporations become even more powerful with financial institutions.

Whatever has happened today has a beginning and has been festering for a long time. For us to have a leader such as Trump is only a function of history and his attempt to change the global game is only going to hurt America. From this context one must look at the global South and North debate with a quick peek into history.

Colonialism to the Cold War

When the world settled down with the defeat of Germany and Japan, in 1945, the British Empire was done. This allowed American style capitalism and Soviet Union styled collectivism to control the world. The reconstruction of the new world began with two new economic ideologies of free enterprise and collective strength. Many nee nations emerged from the darkness of colonialism, and upon seeing light their people thought they were out of their suffering. While the effects of colonialism left behind a bitter after taste of a deep distrust for State run institutions and crony capitalism, nothing prepared them for the extraction that they had to face in the Cold War in the name of democracy and socialism. People continued to remain experiments in this great war of economic ideologies.

As countries began to choose sides, either with the Americans and the Soviets, and created alliances that could bring their people out of poverty. They became obligated in geo politics and their institutions were compromised by powerful nations and their corporations.

The Cold War was a theatre of sorts, small wars took place in Africa, South East Asia and the Middle East. It turned out that the powers to be were placing leaders that either loved capitalism or communism. If colonialism had destroyed whole cultures, the cold war accelerated the destruction of free will in these nations whose people were struggling to cope with either a collective or free enterprise economy.

From here on was born the narrative of developed nations versus developing economies, which were measured on the basis of the size of their per capita income, the size of the GDP, industrialization and high level of technical education.

The inequalities, lack of liberty, lack of transparent institutions in many countries became subjects of celebrated novels by authors such as V S Naipaul, J M Coetzee, Michael Ondaatje and many others. Their novels captured, in a very grotesque sense, the horrors of failed States, leadership, crony capitalism and the lack of hope.

Extraction was real and everyone was a victim of state sponsored terrorism.

So in 1977, when the West German Chancellor, Willy Brandt, set up the Independent Commission on International Development Issues, and wrote an entire paper on the state of the world economy, the words Global North and Global South became highly popular. This is when many leaders chose that the world must change and technology must be shared, albeit in bits and pieces. This is also a story why South Korea, India, Brazil and China were able to change their fortunes.

The Brandt report

This report published, in 1980, by the Commission titled “North-South: A Program for Survival” showcased to the world a line drawn along the 30° north latitude, which included all of Latin America, Africa, Middle East, South East Asia, India and China, representing all these regions as poor.

The report went on to talk about he proactiveness needed from Western nations to alleviate poverty in these regions and foster peace. The core of the report talks about the access to markets and the availability of finance to these countries. It even called the World Bank and the IMF to fund the needs of the poor nations, rather than on the basis of geo-politics, which could lead to faster development.

It is from this context that nations like China and India began to have their modern economies. Both nations have raised their per capita income and are strongly putting in processes in their political and bureaucratic institutions to bring about accountability and transparency. If this continued in a sustained manner they could very much be part of the global north very soon.

However, the same cannot be said of other nations. Africa continues to be run by oligarchs, powerful tribes and political outfits who control the resources which are sought after by global corporations domiciled in the global north.

After the end of the Cold War in 1989, the world began to further the theme of free markets and enterprise, which furthered the interest of politically networked individuals and corporations.

All the moves of globalization were supported by deep finance, in Europe and America, who were in a race to create new markets, increase consumption, build technology and create access to rare minerals for the race to control energy.

Nations like India and China which had a rich cultural heritage, history of institutions rapidly grew with global finance and linking themselves to the global economic growth story.

Both began to create their own capital controls and also controlled their institutions in order to avoid shocks arising from the outflow of capital.

Today, China, by virtue of manufacturing for American and European corporations, has become a centralized technological power that supports and reins in free enterprise at will.

Meanwhile India has become a technology services economy with strong internal consumption and sustained growth.

Like China, India has a quasi free enterprise system with the State protecting the poor. The only difference between the two nations is that India has real parties fighting elections and everyone has access to the law, while in China it’s just the Communist party that is in control.

If Willy Brandt were to be alive today he would truly commend the rise of India, China and some South Asian economies like Thailand, Malaysia and Indonesia.

With globalization factories moved from Western economies to these countries over the last forty years. The country which benefited the most was China.

Today, after one major economic collapse in 2008, the world of globalization is in its last ember.

If one looks at Trump’s tariffs list, it includes all Asian economies, signalling that America itself has lost its control over global trade. Today the corporations are setting national agendas.

With globalization the disparities between rich nations and poor nations have not died. Since 1980 the global south countries have still been struggling to alleviate the same things that were debated in 1980. So will Trump’s tariffs make the lives of Americans or people of the global south better.

The answer is a resounding “No.”

Trump himself is playing into the hands of the corporations who redefine the global south and north lines based on their inconvenience. It is their investments that define the future of nations, jobs and also how tariffs are defined.

With Trump’s every nation State is now going to wake up and start fighting it out with each other rather than the real enemy, which would be global finance and the multi-national corporation. Their only motive has always been to profit from access to a commodity, or a technology, at the cheapest price, just so that the end product can be sold to a consumer with a debt instrument. This is the economy, the consumer economy, that all of us inherited.

America inherited it right after the War, along with Europe, where consumerism accelerated over the last fifty years with costs rising everywhere. Colonialism destroyed old cultures, free enterprise destroyed families and now the State will rein its people towards austerity. The State will be weak and at the mercy of businesses.

Trump’s tariffs will not make America great again, perhaps only fuel patriotic fervour for a short time. These tariffs are going to backfire because all products are going to get expensive for the American consumer thanks to the global nature of the manufacturing supply chain when it comes to essential minerals and commodities.

These tariffs will also take away jobs from nations in the global south if jobs are moving back to America. In the short run the American economy is going to isolate itself from the rest of the world.

All in all, the global south and north debate will be very relevant even for the next fifty yeas, but it will have a new flavour because even western economies are losing their clout since there has been a technology transfer to many countries.

Maybe the USA will want to use things like its military technology, its power of the dollar, its use of AI to remain in the global north. Perhaps, the State of America itself is decaying and may enter the global south list in half a century. Is this going to be the end of the old and rise of the new – we saw the British Empire sink into our history books, will we see the same of America? Is Issac Asimov’s novel “Foundation” becoming the story of the USA – only time will tell.

In this new order that emerges after Trump’s tariffs settle down, one would see that jobs will move away from developing countries. Meanwhile inflation will continue to rise in the West even if jobs are available, which means people will be working for nothing.

Soon we will see a new map of the global north and south. Many nations in the current global south will have to build their domestic capacities to further their economies. Many of us have to invest in austerity or nations will collapse if we continue to leverage on consumption.

It takes guts to be in this brave new world, and yet we have to now have to call it “a broken world.” What the next generation will call it is irrelevant now, and all of us will see new alliances, just like the BRICS movement, to stay relevant. Perhaps in years to come even the USA may be part of the global south as geopolitical power dynamics are shifting. Perhaps the State is dead, and Corporations will draw up a new Brandt line and the new global north-south debate.