The Asymmetry of the Global Changes: Asymmetric States of the Developing Countries

The Asymmetry of the Global Changes: Asymmetric States of the Developing Countries

Guliyeva Aida (Azerbaijan State University of Economics, Azerbaijan) and Rzayeva Ulviyya (Azerbaijan State University of Economics, Azerbaijan)
Copyright: © 2019 |Pages: 25
DOI: 10.4018/978-1-5225-4203-2.ch008

Abstract

The object of the study is the asymmetry of interests in geopolitics between developed and developing countries. In the context of the global crisis, the issue of de-dollarization is relevant from the political and economic points of view. What will be the behavior of small oil countries in this situation is a big problem. Also, for them, the question remains how to get off the oil needle in a painless way? The ways of solving the above-mentioned problem by other states are examined in detail, and comparative analysis is conducted in the case of applying these methods to Azerbaijan.
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Introduction

The object of our consideration is the meaning of the concept of asymmetry and polarization of hydrocarbon resources in a small group of developing countries and countries with economies in transition.

Historically, commodity markets have used the US currency as means of payment. However, an active anti-dollar campaign is gradually unfolding in the world. These efforts often lead to serious and not always positive developments in global politics. The purpose of the work is to find answers to the following questions: what should be done to ensure that the rejection of the dollar will be real? What can a small developing country’s economy expect in a global crisis, with falling prices for raw materials, and after two currency devaluations?

The novelty of this work is studying the structure of the Azerbaijani economy, aimed at getting rid of the “resource curse” - a theory that points to the relationship between large revenues from the export of natural resources and weak economic development.

The aim of research is to investigate this global asymmetry, which is caused by the dominance of the dollar and has the greatest impact on countries whose economies depend on energy exports. Azerbaijan is in the list of such countries.

To achieve this aim it is necessary:

  • 1.

    Suggest ways to escape the global asymmetry in the light of the diminishing returns from oil sales.

  • 2.

    Conduct a critical analysis of the structure of the internal markets and find out why raw materials and semi-finished products are mainly dominant in the exports of developing countries.

  • 3.

    Examine steps that the Azerbaijan government should take towards the development of the non-oil sector (we do not take into consideration such fields of economy as agriculture, tourism, information technologies, etc.)

  • 4.

    Present the authors’ vision for solving the de-dollarization problem from the perspective of a small developing country.

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Background

The concept of asymmetry i.e. disproportion, discrepancy was included into an arsenal of mathematics and physics long ago. Asymmetry belongs to usual, widespread natural phenomena (geological, biological and other). In the 1970s the head of the Pentagon's obscure Office of Net Assessment, Andrew W. Marshall, was one of the first to apply the term “asymmetry” to the military-political sphere: he paid attention to possible asymmetric warfare with such, apparently, symmetric opponent as the USSR (Lemann, 2011). Actually, at first the term “asymmetric relations” had a military strategic importance and only later became widely used in the political and economic speech.

Scholvin (2016) reveals in detail how asymmetry turned out to be an important aspect mostly in each known geopolitical relations. The asymmetric strategy is always present in relationships (Meinhardt, 2002). All modern asymmetric conflicts can be understood when they are considered through the prism of the strategy and concludes that asymmetry is a strategy and strategy is an asymmetry.

As Bourguignon and Morrison (2002) describes national economies in the framework of the world economy and international economic relations in late XX - early XXI century, these relationships are also characterized by the asymmetry of the states’ developments. This was reflected primarily in the greater inequality between them. The system transformation crisis of the 1990s changed the place of the post-Soviet countries quantitatively and qualitatively, throwing them back. With the successful development of China’s economy against the background of post-Soviet countries’ national economies also increases asymmetry of the world economy (King, 2009; Lau, Qian & Roland, 2000). Investigating relations with Asia Schaffer (2002) determines that even within certain, especially large multinational countries (India, etc.), there is practically no homogeneity of economies and asymmetry in their development is also observed. This fact also applies to such a stable regional community as the European Union.

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