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The erosion of economic power notwithstanding, the West remained an important consumer market. In the 1990s, a core foreign policy theme was conditional engagement: access to the Western market in exchange for accepting Western rules and values, including free trade, democracy, and the rule of law. Striking, however, was that the countries profiting the most from the age of globalization and the openness of the West were not the democratic countries.

Authoritarian countries, especially China, rapidly expanded their share in Western imports from 15 percent in 1990 to 34 percent in 2012 (figure 1.4). The countries growing their export revenues from the West the most were thus not necessarily free, democratic countries, but often authoritarian countries. Conditional engagement was self-deception.

Figure 1.4 Share of authoritarian countries in total imports of EU and US (%, EU is extra-EU)

Note: Coding for authoritarianism based on World Governance Indicators (accountability and rule of law).

Sources: WGI and UNCTAD.

Figure 1.5 shows that economic openness advanced between 1990 and 2010. Afterwards, its advance slowed significantly and even tapered off. More remarkable is the fact that political openness hardly increased during these 30 years. Of all the countries in the world, at most 46 percent could be defined as free. Of all the people in the world, at most 40 percent lived in a liberal democracy. The peak of democratization was around 2008. Afterwards, not only did economic globalization stagnate, but democracy receded slowly as well. There is thus not much evidence that globalization promoted democracy in the world. Economic openness, if it ever truly existed, did not lead to political openness. Still, this tune was repeated by Western politicians again and again.

While the world was celebrating the high age of globalization, even physical walls returned. Altogether, over 13,000 kilometers of walls and border fences were built between 1990 and 2019 (figure 1.6). By comparison, the Berlin Wall was just 155 kilometers long; the whole Iron Curtain, the fault line between the Soviet Union and the West, was about 6,800 kilometers. Walls have emerged in every region: Europe, Asia, Africa, and the Americas. The idea that commerce would level out borders and barriers has thus not materialized. Nationalism never entirely vanished. Memories of previous wars and territorial disputes continued to hang as a dark shadow over trading states like China, South Korea, and Japan. In Europe, despite decades of integration, center politicians continued to struggle with nationalist parties and the vast majority of citizens still identified themselves more as national citizens than as European ones.

Figure 1.5 Economic and political globalization: economic globalization index, share of free countries, and share of world population living in liberal democracies (%)

Sources: KOF, Freedom House, Anna Lührmann, Sandra Grahn, Richard Morgan, Shreeya Pillai, and Staffan I. Lindberg, 2019. State of the world 2018: Democracy facing global challenges. Democratization, 26(6), 895–915.