The second half of the 20 th century was a period of transatlantic economic hegemony. The United States helped rebuild war-torn economies and was a main driver of the dynamic growth in trade in the postwar era. The United States was the demandeur of all eight rounds of multilateral trade negotiations under the General Agree- ment on Tariffs and Trade (GATT); U.S.-European collaboration set the agenda for and led to the successful conclusion of each of those rounds. This leadership contributed to the strengthening of the trade architecture and the establishment of the World Trade Organization (WTO) in 1995. But unlike the GATT era where a transatlantic com- pact was sufficient to produce global trade pacts, in the WTO era U.S.-EU agreement is still necessary but no longer sufficient to achieve success.
In the 21 st century, many developing countries now play an active role in global economic initiatives. The rise of Asia combined with the new institutional structure of the WTO have been important factors in this regard.
Asia’s success story—driven by steady expansion of trade and investment and increasing integration in global value chains—has led some observers to proclaim this new era as the “Asian Century.” Projections of Asian economic growth show sharp increases in developing Asia’s aggregate share of global GDP: in the first decade of the 21st century, the dynamic growth of China and India, along with the members of the Association of Southeast Asian Nations (ASEAN), more than doubled their combined share of global output and exports, as shown in Table 1. Projections for 2025 suggest that China’s GDP will rise to $17 trillion, accounting for 17% of global GDP, compared with GDP of $1.2 trillion and 4% global share in 2000; while India’s GDP will reach $5.2 trillion, about the same as Japan. Similarly, China, India and the large ASEAN economies are projected to increase their combined share of world exports from 18% in 2010 to 25% in 2025, while the US and EU combined share will drop from around 43% to 36%. The Asian Development Bank projects that by 2050, Asia could account for more than half of world GDP, trade and investment.
What are the economic consequences of Asia’s rise for the transat- lantic partners? Do they face a new “Défi Asiatique?” Asia is undoubtedly on the rise. But predictions that the aggregate growth of the region portends the advent of an “Asian Century” seem to exaggerate the potential “défi” for the transatlantic powers, in at least three respects: First, in an era of accelerating globalization, it is hard to talk about a country or continent dominating the global scene. Interdependence is a fact of economic life; at the same time, it both drives and con- strains political action by major economic powers around the globe.
