This article first appeared in The Edge Financial Daily on January 16, 2019

KUALA LUMPUR: There is a growing sense of discontent with and injustice in the trend of globalisation in recent years, and Malaysia is not spared from these challenges, according to Bank Negara Malaysia (BNM) assistant governor Marzunisham Omar.

Marzunisham said it is no surprise that the accusations of free trade causing job losses and disproportionate depression in wages have shifted from economic textbooks to the forefront of policy discussion currently.

“The next decade will be even more challenging, with rapid technological advancement poised to accelerate job displacement and potentially worsen income inequalities. Malaysia faces this similar challenge. As we liberalised our economy over the years, there [have been] industries and workers affected by rising competition,” he said at the World Bank Group’s conference on “Globalisation: Contents and Discontents” yesterday.

“As our economy evolves, we [have] moved out from uncompetitive sectors and industries while new opportunities opened up,” he added.

Nonetheless, Marzunisham said policies had been implemented to facilitate these industry transformations while assisting displaced workers, including enhancing upskilling programmes, strengthening social safety nets and ensuring sustainable fiscal redistribution.

He added that the world had once envisioned to use globalisation as a beacon of unity, but it had fuelled increasing polarisation in recent years.

“Let’s remind ourselves that in this globalised world, it is important for the contented to appreciate the struggles of the discontented, and for the discontented to not lose sight of the potential of [a] globalisation hold. 75 years after Bretton Woods, the creation of a safe, fair and mutually beneficial global system is still not an easy pursue; it is nonetheless a necessary one.”

Marzunisham also said globalisation had led to trade and financial integration, and had contributed to unprecedented economic growth and prosperity.

“Global output has increased more than sixfold in the past 50 years. A billion people have been lifted out of abject poverty in just one generation,” he said.

“Although the gains from globalisation are vast and widely acknowledged, its fruits have not been equally shared by all. The growing sense of discontent and injustice among the marginalised has led to a retreat from globalisation and multilateralism in the recent period.

“This reminds [me] of what the late Kofi Annan said: Globalisation is a fact of life, but I believe we have underestimated its fragility,” he added.

Marzunisham noted that the retreat from global integration and multilateralism today serves as a wake-up call for policymakers to reflect on the realities of globalisation, to re-examine policy choices and to recalibrate the way forward.

“With rapid technological advancement, globalisation has become [an] increasingly polarising force; the social political and economic issues at hand are more pressing than ever.”