The Rise of the Corporate Country
Recently I read an article in which BlackRock CEO Larry Fink and Volodymyr Zelensky agreed to coordinate investments geared toward rebuilding Ukraine in an announcement from Zelensky’s office published Wednesday following a call between the two parties. It is to me quite astonishing to see the rise of private investors committing funding/aid to a foreign country after a war as opposed to that of investments coming from other countries.
This is a dramatic U-turn from the status quo. If we backtrack to the end of the last major conflict in Europe, the Yugoslav Wars, the main investors contributing to rebuilding the newly formed Bosnia and Herzegovina, Croatia, Macedonia, Montenegro, Serbia, and Slovenia were all nations. The same goes for the end of WW2. The Marshall Plan, also known as the European Recovery Program, was a U.S. program providing aid to Western Europe following the devastation of World War II. It was enacted in 1948 and provided more than $15 billion to help finance rebuilding efforts on the continent.
Now this doesn’t mean that funds from nations and their associated institutions are obsolete. They are now just working in tandem with the corporate world. This does however raise some interesting questions. I am not saying that we are heading towards the re-emergence of corporatocracies, such as those established by the Dutch East India Company, which is a form of government that is controlled by corporations or their interests. I am, however, suggesting that this cements the growing power of the multinational corporation.
The emergence of the MNC has effectively led to the formation of a global organization that may have a significant impact on a state’s governance in addition to its economics. For instance, it is always intriguing to observe that 51 of the 100 largest economic organizations on the planet are businesses rather than countries, or that “the 500 largest firms account for 70% of world trade.” Corporations not only have the political power to influence states, but also the economic clout to devastatingly affect a state’s economy should the state try to oppose a multinational corporation. It is not surprising, then, that states feel unable to formulate effective economic strategies or to plan for the future.
It is interesting to wonder what may come next for the ever increasingly powerful MNC’s and their interests. But for now the best indicator of where they may be heading is certainly their involvement in rebuilding a devastated Ukrainian economy.
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