Tired of America’s bully tactics of trade sanctions, four countries of the world at the Islamic Summit have decided to revert to the primitive trading means of barter. Their aim – create a hedge against future economic sanctions.
Heads Up! Below you will find…
- Islamic Summit response on Economic Warfare
- Issues discussed at the Islamic Summit
- Leaders speak up against Muslim persecution
- How Protectionism policy is behind the continued Global Slowdown
Malaysian Prime Minister Mahathir Mohamad recently confirmed that Iran, Malaysia, Turkey and Qatar are contemplating gold-trade and barter system to fight off the American way of sanctions.
The move comes after the close of an Islamic summit in Malaysia. Mahathir lauded Iran and Qatar’s act of not succumbing under the pressure of economic embargoes. The Muslim world is increasingly sceptical about western intentions and are planning ways to become self-reliant and immune from future threats by bigger nations.
The Muslim world is looking at ways to become self-reliant and immune from future sanction threats by bigger nations.
Malaysian PM said that in today’s world, nations make unilateral decisions to impose punitive measures. Nations should be wary of such sanctions against them from the first world nations in future.
Islamic Summit discusses Barter against Trump and US-led Economic Warfare
With the backing of the US, Saudi Arabia, the United Arab Emirates, Bahrain and Egypt cut off trade and diplomatic ties with Qatar two and a half years ago. The embargo was based on allegations that Qatar supports terrorism.
Likewise, Iran to bore the brunt of global factions exercising protectionism after the US-imposed economic embargo in 2018. Malaysian PM, wary of such actions, projected the idea of reviving the Islamic medieval gold coin exchange system. Mahathir said, “I have suggested that we re-visit the idea of trading using the gold dinar and barter trade among us”.
Malaysian PM projected the idea of reviving the Islamic medieval gold coin exchange system.
As per the Islamic Summit reports, leaders of the four countries are looking at ways to promote business among them and trade using their own currencies instead of the dollar.
Stance of the Saudi Arabia-led faction
Saudi Arabia snubbed the Islamic summit. It condemned the summit, stating that it undermined the Saudi-based Organisation of Islamic Cooperation (OIC). The OIC includes 57 Muslim-majority countries. As per reports, 20 of the 57 countries participated in the summit. Invitation had been extended to all of them.
The summit also discussed issues like Palestine, Kashmir, the Rohingyas of Myanmar, Uighur persecution in China raising concern that Muslims were facing persecution and undergoing forced assimilation in non-Muslim nations. Mahathir said, “We support integration but assimilation to the extent of shedding our religion is unacceptable”.
Malaysian PM Mahathir also called India’s new citizenship act “unfortunate”.
Against the new global normal
The world is witnessing trade wars, tariffs and duties, currency manipulation; and shrinking support for free trade. Bigger economic powers are increasingly resorting to protectionism in global trade.
Policy decisions are actively driving the protectionist approach. It is constituting a global slowdown. Today, globalization’s definition is affected by the growing hegemony of economic powers resisting change in the geopolitical landscape.
Major economies opt for free trade agreements to facilitate trade and capture foreign markets. However, when new countries emerge, they are seen as rivals challenging the hegemony. The way bigger powers try to tackle this is through economic embargoes and sanctions.
Recent sanctions have now triggered the idea of moving back to barter for developing nations at the Islamic Summit in Malaysia.
Protectionism effect on global economics
Due to such sanctions, consumers in developing nations have to pay higher prices. Reduction in market accessibility for manufacturers damages profits, investments, and jobs. It is also leading to the contraction of demand and consecutively lower consumer surplus.
As per the Global Trade Alert 2017 report, over 50% of exports from G20 countries were subject to more harmful trade measures.