Globalization. Once seen as the key to peace — by spreading
prosperity, worldwide. But the idea of free and fair trade
is losing ground as competition between the world’s
economic powers grows. China’s trade ambitions
were made clear with its giant "New Silk
Road" infrastructure project. And the US continues to
believe in "America first". But it’s the world’s poor
who are paying the price for this global competition. The German city of Duisburg has
re-awoken from the ashes of its past — thanks to China. As a developing country, Peru
sees few benefits from globalization. And is engulfed in poverty. But somehow or other, we’ve got to
understand that globalization works. But it has not reached more
than 30% of the world's population. Very simple. Do we really make the most of trade
opportunities in a globalized world? Some are questioning the
World Trade Organization as the guardian of fair trade. And with it, globalization itself. I don't even think you
can block globalization. But we need to look carefully at,
who are the winners and losers. Duisburg in Germany’s
Ruhr river valley. Once a bastion of the German
- and European - steel industry. Duisburg was a center
for steel and coal. In the late 70s, the Chinese dismantled an
entire Krupp steel plant here, even the screws, and
shipped it to China. And that was the end of
10,000 jobs, or even more. There was high unemployment
and an urgent need to change the industrial structures. The city’s "Duisport" is now
Germany’s largest inland port. The logistics hub is run by the city and relies on the
"just in time" principle: goods arrive just
as clients need them, reducing the need for
costly logistics and storage. China is the port’s most
important trading partner. Ironically, after flooding Europe
and the US with cheap steel, the economic giant has now
emerged as Duisburg‘s saviour. In 2014, Chinese President
Xi Jinping hailed Duisport as the final stop on
the "New Silk Road." And as China‘s gateway to Europe. Duisburg was happy
to enter the alliance — with its promise of dozens
of freight trains every week — but negotiated carefully. The city had been warned: China was luring countries
along the route with cheap loans for the expansion
of their infrastructure. And as a result of excessive debt, the ports of Piraeus in Greece
and Hambantota in Sri Lanka are now in the hands
of Chinese operators. From our point of
view, it is very worrying. Or, from my point of view, it’s
very worrying what’s happening in other parts of the world
along the New Silk Road. Piraeus and Sri Lanka are not the
only troubled ports with financing. But it’s fundamentally
different here in Duisburg. All of the port infrastructure
belongs to the port. Transport by ship
would be cheaper. Nevertheless, some 60 freight
trains arrive from China every week. For the return journey, the wagons
load up goods from all over Europe. About 70 employees are spread
across the UK, China and Germany. We pick up e-commerce
parcels with our own vehicles. These have just come
in from France today. We'll load them into containers
and then they'll go to China by rail. They'll reach China in 2
weeks. In 2 to 3 weeks. It's very fast at the moment. The Chinese know Duisburg. When you arrive here from
Beijing, you don't even see Berlin. You see Duisburg as
the center of Europe. Empty tracks have become
an increasingly common sight since Russia marched into Ukraine. Supply chains are
vulnerable — a risk. But Duisburg is
preparing for the future. You can’t lean back and say, “We
have 60 trains a week from China.” Who knows whether this will continue,
and we have to consider alternatives. Duisburg has also invested
in Trieste, for example, to build a site there that
could be supplied via Turkey and southern Europe. Duisburg is already
developing alternatives — without abandoning the
concept behind this port. Duisburg's strategy
in the global logistics and transport battle seems effective: forge alliances, but stay
independent and flexible. I think what the corona pandemic
of the last two years has shown us, is that global trade is more
intricate than we suspected. So I think we’ll now have to adjust to having several suppliers
in several countries, to try to limit the geopolitical risk. One consequence will probably
be more expensive products. Because what China is
offering is very attractive. It’s a very
technologically-advanced country. Chinese competition
will increase in markets where it’s yet not
being felt so clearly. Unlike Duisburg, the
American steel industry is having a hard time
developing new markets, even though it’s been
fighting cheap competition from overseas for 40 years. Follansbee, West Virginia. Coke
for steel production is produced here. But now, this plant in the famed
American “Rust Belt” is closing. You know, I'd love to sit here and say that the steel‘s
gonna be here forever. But 20 years ago, 40 years
ago, if you were in Pittsburgh, you didn’t think steel
was going away forever. But there's almost
nothing left, there. Steel made the USA
rich and powerful. The railroad, machine and automobile
industries were the biggest customers. 288 people will now lose their
jobs when the coke plant closes. And nearby, Weirton has seen
the closure of several steel mills since the 1990s. I saw this happen at Weirton. Weirton used to be, basically,
totally, on their own down there. They didn‘t have to
depend on anything. They made their own cinder, and
then they shut the coke plant down, they said well, you can buy
coke cheaper on the open market. And that was true, they could. But once they could no
longer make those products, then the companies that were
selling it had control over it, they started raising their prices. As early as 2002, global trade meant
cheap steel for markets everywhere. To protect the US, President George W. Bush
decided to impose import tariffs on foreign steel. The World Trade Organization, the WTO,
the arbiter of free and fair trade, was caught in the crosshairs. US unions backed the move. American steelworkers
feel cheated. Other countries have become
more competitive than the US — but at what cost? President Trump also
imposed punitive tariffs. Now, Joe Biden‘s promise to allow
European steel access to the US market is arousing distrust. Of globalization, as well. It‘s a very globalist
administration. We were independent energy-wise, and
we gave it up in a couple of years. And, all in the name of free
markets and globalisation but that doesn’t
sound free to me. And don’t get me wrong, that probably
worked out for a lot of people and a lot of jobs in
other parts of the world. But it cost some here,
in this part of the world. Globalization has lifted a billion
people or more out of poverty. Now, that does not
mean it's perfect. It’s not. There are obviously poor
people in rich countries who have been left behind. And in those cases, their
governments did not have the active labour market policies to provide
solutions, where they lost jobs. You know, there
was a point in the '80s, when National Steel was going
to close Weirton Steel down — we were a division of National. And I was laid off for 18 months. And not just me, the whole town
was laid off for quite some time. Our town’s a survivor. You
know, we’ll get through it. In Weirton, fewer than 1,000
jobs remained — of 14,000. There is room for new industries. But the "America First"
approach casts a long shadow: Instead of acting globally,
people here act nationally. Steel companies are
reluctant to take advantage of the opportunities
offered by multilateral trade. They turn instead to
government subsidies. In 2018, in a trade
dispute with China, President Trump initiated
new tariffs on imported steel, winning plenty of
support in Weirton. It ended up helping us
immensely. Both times. First when President Bush did it,
then when President Trump did it. It helped our workers weather
the cheap steel that was comin’ in. The Gurrera-Thompson family
has lived off steel for generations. But Karen recently became a
widow after her husband Carl — a steelworker and
staunch Trump supporter — died from Covid-19. If anything he was proud
of, besides his children, it was to be a steelworker like
his parents, and his grandparents. But when he worked in the
mills, it was always pretty good. For us it was times of
struggle and good times. Struggling times when the
mill wasn’t going so good. Less than a thousand work
there now and it’s from downsizing. You know, getting rid of
jobs, farming out the work, you know they gave it away
and wasn’t going to pay top dollar when they could get it
somewhere else a lot cheaper. I think we need to be able
to take care of ourselves not just our country every
country should be self-sufficient because I don’t see China
selling us armored plate to build tanks for another world
war, if god forbid, that happens. I just watched it
for years, I’m like, we’re never going to be
able to protect ourselves, because we don’t have
the manufacturing to do it. The way China conducts
business with the rest of the world. It's the same thing, everybody
is out for their national interests. So once the globalization gets so
big, it’s inevitably going to contract once people start feeling a little
bit nervous about their neghbors growing too strong,
growing too wealthy, then we’re going to start worrying
about our own national interests. Our government betrayed America,
betrayed the American steelworker. And they’ll do so agin today. We just
had a bridge collapse in Pittsburgh. We can’t even get the steel to
rebuild the bridge from America. You have to go overseas, and
China is one of the major culprits. They’ve built so many steel mills and they don’t have the
same set of rules we have. They don’t care
about their envirnment. Environmentally, all
countries ought to be required, all mills ought to be required
to have a clean process. But China it's a filthy country,
OK. And it's a dirty country, they don't care about
their environment. They don't care
about their people. So many countries are coming up. Maybe some of them faster,
some of them not so fast. So let's not exaggerate.
But you know, China for sure. And some of these developments
were not really thought through, so that the instruments
we have, the rules we have. Are a little bit outdated. They do not catch some of these developments,
so that's absolutely right. I was a strong advocate to get
out of WTO Trade Organization. Ultimately, you're not going
to be able to do it by yourself. OK, because there
has to be exports. There has to be a system of
trade, OK? On a global basis. But you can protect certain
industries within that global economy. Steel should be one of them. But why subsidize a mass
market product like steel when it has no chance
on the global market? It’s time for a new approach. Enter into, especially in
niche markets, is a direction — they kind of had
that with the template that double reduced
template they made years ago, it was the best in the world and
that's what kept Weirton Steel afloat. And even in hard times
Weirton Steel could stay ahead of the other steel mills in
this country because of their... their quality template
that they put out. But it is a global market out there
and to compete in the long run, that's just not selling your
product within the the 50 states, we're going to have to be able to
to go into that worldwide market and, whether you like them or not, yeah,
the crossroads end up at the WTO. So, we‘ve got to be able to play
the game as well as everybody else. Washington DC. Home to
those responsible for subsidies and protectionist tariffs. The people governing protect
not just the steel industry, but the agricultural economy, as well. And then the hammer
really came down when President Trump rewarded
agriculture by giving, you know, 10s of billions of dollars
to American farmers, essentially to offset
their trade losses Trump somehow came up with a way
of distributing subsidies to farmers without going through Congress. We just get checks in
the mail, so to speak. 2011. Illinois. The farm
of John and Aaron Phipps. Even then, America's farmers
benefited from farm subsidies. Agricultural subsidies to
be morally irresponsible. And I mean there is
simply no justification for it. I just get that for having a body
temperature somewhere close to 98.6, not because I do anything,
not because I'm worth a while or or any deserving factors
simply because I have those acres. I get $24.00 for every acre. Well, once you hand that
$24.00 out that every farmer. Then the first
thing he thinks of is: I know I can afford to spend $24.00
more to bid on this extra 200 acres and make my farm 200 acres larger. 'Cause that's what the what we're all
doing. We're trying to trying to grow. Welcome US Farm
report this weekend. I'm Tiny Morgan, and
here's what's in store. Just moving from field to field is an
ongoing constraint on machinery size... John Phipps is now retired. He’s a commentator for U.S.
Farm Report TV, a weekly TV show. Last week I began an
answer to a viewer regarding carbon dioxide emissions. I have people who just can't stand
me, and actually they're my favorite. And the other half are people
who just got up early in the morning and it‘s generally on the
stations early in the morning, and they're looking
for something to watch and they've gotten hooked on
what's happening in agriculture. The farm receives well over
$100,000 in subsidies every year. These include
compensation for crop failures, tax relief and direct payments. In the 1980s, you know, Dad said, you know there were years
that the government payments, that's what the family lived on. You know the farm broke even at
best, and that was the money that, you know, put food on the table
and and got clothes on my back and got me to school
and everything else. So, even during the lean
years, classic of a child, I didn't really know. I had no clue. So it wasn't true poverty. Why we qualified for it? I'm not exactly sure, but
money just poured out of the sky and unlike European subsidies, we are drifting away from
having to perform any actions. Any environmentally responsible
actions or any quid pro quo. Through the Trump years, I was a net drain on the economy
because I got more back from the federal government in subsidies
and payments than I paid in taxes. And markedly so the Trump year
monies were just — it was insane. In fact, farmers in general tend to
be Republican in the United States. So Trump in order to not lose the
political support of those farmers, transferred huge amounts
of resources to farmers in the form of direct
subsidies, income subsidies to compensate for the foregone
export revenue that they lost. Former President Trump did very
well. He knew who his base was. He knew who voted for him, and his thought was as long as I can
make amends for this group of people I will get re-elected. Agricultural subsidies
distort markets. But there is hope that surplus
food will stop being exported cheaply — or for free — to developing countries, where it
destroys local agricultural markets. Export subsidies are
virtually off the table. There are virtually no
export subsidies anymore. A bit of food aid, but
export subsidies have been pretty much eliminated
over the last 20 years. It's not to our advantage to have a third of the of the
world in economic squalor. Because then we have no
one. To sell our goods to. The US agricultural surpluses have
driven some South American countries deeper into economic misery. Peru is one such country. Economically downtrodden,
with no real prospects in sight. Unlike the US, Peru has no money
to subsidize its meagre economy. Corruption and mismanagement
further weaken economic development. Hernando de Soto is
a Peruvian economist who ran for the presidency in 2021,
though he lost by a small margin. Governments around the world
seek his advice on economic issues. Even though official
statistics say that Peru is probably at the end of the
worst of all developing countries, the fact of the matter is,
we're probably even worse than what the statistics say. Between 2016 and today,
we have had four presidents. 4 presidents and 1-2-3 parliaments.
Because the system has collapsed. Peru has one of the highest
Covid-19 death rates in the world. The pandemic helped the “informal
economy” expand even further. The country is rich
in raw materials. But they are mined
mainly by foreigners. Particularly by the Chinese. We have been mining
lithium in mines near Chile, in the south of the
country, for many years. The product has great potential. Lots
of countries are interested in it. China, for example, is the first
country that wants to benefit from it. China is investing in all of
Latin America, including in Peru. The Chinese want to
build a port in the north, which will help them
open up the Pacific. Fishing is also crucial
to the local economy. But so far, there has been
very little foreign investment in major fishing companies. Not even from China. China is investing massively
in mining and hydrocarbons, as well as in other sectors of
the economy. But not yet in fishing. The small town of Chancay depends
on fishing. And on a fishmeal factory. About ninety such plants
can be found along Peru's more-than 2,000
kilometres of Pacific coast. Miriam Arce and Juan Carlos
Sueiro know the area best. Juan Carlos Sueiro is an economist
and fisheries expert for Oceana, an international marine
conservation organisation. Miriam Arce is fighting the
construction of a mega-port. Industrial fishing is on a break. The season won’t begin
for another two weeks. The platforms are anchored in
the seabed so that they do not move. They are connected
underwater to the fishmeal factory. This blue conveyor carries the fish directly to the
factory for processing. We catch four to six million
tons of anchovies a year. They are made into
fishmeal and fish oil. 97 or 98% of the fishmeal is
exported, 70% of it to China. That means that China is one
of the biggest buyers of fishmeal. China will make a grab for Peru's fish
resources. It’s just a matter of time. Next to the town
— and adjacent to a nature reserve — a new port is being built. Chinese investors are
behind the "Megapuerto", or "megaport", under
construction here. The harbour will
collapse...Never! Our beach is not for sale, we will
defend it! "No" to the "Megaport"! The port’s construction has been
the subject of debate for years. Ecological and economic
arguments balance each other out. The new port is dividing
the people of Chancay. Worst of all, they want
to steal our identity. And they're creating
conflict between neighbors. It hurts me because
I was born here. The location is great for the Chinese because they aren’t
just exporting fishmeal. They can also export
minerals to China and bring their goods
directly from China to Peru. The port will just be for them. The new port will also compete
with the local fishery in Chancay. Chinese deep-sea trawlers
will call there, and fish the coast. And the Chinese are already illegally
tampering with Peru's fish stocks. There is already a conflict: the Chinese fleet is
fishing our giant squid, even though they do
not have authorization for Peruvian territorial waters. The Chinese fishing
fleet has grown massively. Within a decade it has
become three times bigger. The platform "Global Fishing Watch" shows the movement of
the Chinese fleet very well. In July, the Chinese stay
south of the Galapagos, then they go down the
coast to Peru and Chile and even as far as Argentina. And that's part of this
conflict, with China. Peru is a developing country. Three quarters of Peruvians work
off the books, on the gray market: without any state social net. No government has
been able to create an orderly and
sustainable labor market. The well-educated
are leaving the country: Another blow to Peru's economy, as it struggles to
profit from globalization. No. Of course I
cannot be satisfied with a system that's left
70% of the population behind. Well, what has changed
is that we have, now, an awareness that
globalization is not, and its virtues are not accessible to everybody
in the world in the same way. Remember that we always
talked about the informal economy. The first being that that economy
didn't have rules that were connected to the global system. They had local
rules, but they didn't — they were not
connected to global rules. However, Peru has achieved
some small successes in the fight against poverty. In 2000, "Mibanco"
was the first bank in Peru to grant loans to the very poor, no guarantee required — so-called "microloans". The informal economy is
a major problem in Peru. It is a consequence of migration, with many people coming to Lima from
rural areas and the Andean region. That's why we started giving
loans to the rural population. Helping people to help themselves, while integrating them
into the national economy. That was — and is —
the goal of microloans. 2009. A visit to Julio Solis.
His company makes gas stoves. A loan from Mibanco
allowed Julio Solis to expand. I couldn't get anywhere
because I didn't have any money. So I knocked on the doors of
several banks, looking for financing. But they refused,
and gave me nothing. A lot of young people are
looking for work in the factories. By hiring five or six people, I can help my country
and give something back. That is my dream. 12 years later. Marleny Aparicio
and her eldest son Franco take us to a cemetery near Lima. Julio Solis died in December
2020, at the age of 47. He died a year ago. A lot of families have been
affected by the pandemic in Peru. The virus took our father too. We will continue his work. He was a man of integrity who
was determined to make a difference. He did everything for
his family, for his children. His family was always the
most important thing to him. I send him a kiss, in heaven. The small factory hasn’t moved.
But now it’s twice as big. 15 men and women are
permanently employment here. I want to tell you something.
I was in a restaurant in Lima. They were cooking
with our stoves. It's nice that they use
our products to cook. They are using them to prepare
food for people. That makes me happy. My father wanted to sell our
products on the international market. His goals were Chile and Bolivia.
We want to make his idea a reality. Me, my mother, my
brothers and sisters. We all want to try. It was our first loan. Just a small amount,
about 1000 Peruvian sol, which is about 250 US dollars. Lots of banks slammed the
door in our faces back then. Now they keep knocking on our
door, wanting to give us a loan. But we don't need a loan now. The region around Puno is
one of the poorest in Peru. In 2009 Pro Mujer, a
development organization, offered microloans
to fisherwomen. The aim of Pro Mujer is to encourage
women to improve their lives. We give them loans,
based only on their word. My life has improved. I
used to often lack money. Now I am happy because my children can
go to school. I can help my family. 13 years later. Gloria
has given up fish farming. The polluted waters of Lake
Titicaca constantly killed her fish. Her family now wants to go into
tourism, with an island made of reeds. They’ve invested the money they earned
from fish farming in the new project. A loan of about 100 US dollars
is still making a difference today. The organizations, the NGOs,
that started the microcredit programs caught the attention of
the big financial institutions. In the beginning, they took big risks. This is a very good example
of the need for innovation to promote development and
improve the living conditions of the most
vulnerable populations. What I like about microcredit is that it is one way of
getting to the solution. I mean, first of all it is
that people do want credit and the fact that you adjust
to help poor people is good. Microcredit is a step
in the right direction. It alleviates, but
it's not a final stop. Globalisation is in crisis. The world trade system has
led to fewer and fewer winners. Protectionism and
nationalism appear to succeed but it’s not the best
who win, but the richest. The geopolitical goals
of the powerful mean that many poor
people are the losers. Yet globalisation seems
to be the only alternative. Globalization, in other
words, is still a good thing. Of course it is. It's
the division of Labor. It is the the bringing
together of humanity. Above nationalism above
religions. It's a good thing. Those who are really globalized
will continue to be stronger than those who
are non-globalized. How does trade
contribute to the solution? Those are the right
questions to be asking, not let's withdraw into ourselves
and try and grow everything ourselves. Produce everything ourselves. You know manufacture
everything ourselves, because that in
itself is highly risky. Let us invest in multilateralism,
in global cooperation in the multilateral trading system. It's a global, public good and
we shouldn't underestimate our important details.