THE NEXT GLOBAL STAGE
By Kenichi Ohmae
Pearson Power
PP: 282
Price: Rs 499
Whether we like it or not, globalisation is here to stay. Despite the World Trade Organization's (WTO) slow crawl, companies and consumers will increasingly and inexorably cross their own borders to do business. One man who foresaw this long before most others, is Kenichi Ohmae. The nuclear engineer from the Massachusetts Institute of Technology (MIT) and former McKinsey consultant has been talking of a borderless world for at least two decades now. His first book on the subject, Triad Power, urged companies to embed themselves in the triad of Europe, Japan and America to be able to compete on the global stage. His next book, The Borderless World, published five years later in 1990, looked at what corporations would need to compete in a world where economic boundaries were merging. In the books that followed (End of the Nation State: The Rise of Regional Economies; and The Invisible Continent), he built on his globalisation arguments, pointing out, for example, how clusters of highly competitive regions were emerging within countries across the world that would be the real engines of growth, and why in the new scheme of things, capital would always chase the best return, no matter where it came from.
The Next Global Stage, therefore, is another attempt by Ohmae to make sense of the rapid changes that are taking place in the global economy, and how companies, governments, and even individuals need to respond to it. First off, says Ohmae, forget all the rules of traditional economics. Why? Most of the principles, he argues, were developed keeping the nation-state framework in mind, but now that it is region-states that drive economies, those principles need to be reconsidered. A high interest rate, says Ohmae, need not always harm capital investment; it can be a powerful means of attracting money from other parts of the world. He cites for example the Greenspan era during Bill Clinton's administration, when the Federal Reserve kept increasing interest rates in small doses in the name of cooling an overheated economy, but all it really wanted to do was get global investors to put more money into America. Ohmae's suggestion that "the global economy is new. There is no rulebook. Nobody knows what will work. The only solution is to try and, if at first you fail..." may not be too comforting to those looking to the book for a roadmap for the new era. Still, there's one thing The Next Global Stage (minus a few typos) will not leave you in doubt of, and that is just how much the world really has shrunk in the past two decades.Business Today
