Introduction

The patterns of trade and financial flows that have emerged since the 1990s, as discussed in the earlier chapters of this book, have undoubtedly disrupted the traditional lines of North–North and North–South economic exchanges, which had defined the global economy during the post–World War II period from the 1940s to 1970s. These disruptions are accompanied by a promise of greater economic strength for historically less- developed countries of the South but also have created some undesirable imbalances. The early attempts at South–South integration, under the banner of the Third World and the Non-Aligned Movement, demanded a more equitable world. It now seems quite possible, however, that the current rise in South–South relations through trade, finance and diplomatic and political agreements may reinforce rather than dismantle the traditional global hierarchies. Disparities between the Emerging South and the Rest of South are rapidly replicating the old North–South colonial pattern of trade. These trends, though alarming, are not inevitable or irreversible. In this chapter we present a framework for examining the various transmission channels through which South–South relations operate. Identifying these transmission channels can help us to understand how the positive aspects of South–South economic exchanges can be harnessed and the negative impacts mitigated.

This chapter proceeds as follows. First, we chart the rise of “new-developmentalism” as a progressive response to neoliberal development and argue that, to understand whether South–South relations hold the promise for an alternative model of development, it is worthwhile to explore existing critiques and alternatives. We discuss why the recurring predictions of the end of neoliberalism have repeatedly fallen short and, in any case, what exactly an alternative to neoliberalism may be. We then move to discuss the burgeoning literature on “new-developmentalism,” its main tenets and its analysis and critique of neoliberalism. While new-developmentalism provides an accurate critique of the tenets of neoliberal globalization, it fails to take into account the systemic pressures operating in the global economy. In Sections 5.4 and 5.5 we examine South–South Integration and “new-developmentalism and analyze how the rise of China and other Emerging South countries is both hindering effective development in the Rest of South and creating new possibilities for it.