As we approach the conclusion of 2023 and embrace the arrival of 2024, we find ourselves on the brink of completing the first quarter of the 21st century. The past 25 years have witnessed significant transformations, setting the stage for a new world order. While a comprehensive analysis of the complex dynamics shaping this development would require an extensive scholarly project, I will endeavor to provide a condensed overview in this brief essay.
Three Components of Global Power
To comprehend global power, we must delineate its components. The triad of hard power, encompassing military strength and aggressive capabilities; soft power, comprising diplomacy, culture, alliances, trade, and markets; and internal governance, emphasizing capable leadership, peaceful power transitions, efficient governance, justice, prosperity, and unity serves as our measuring framework.
Over the last quarter-century, the landscape of power has shifted. Traditional metrics of hard power, such as planes, tanks, and soldiers, have seen erosion, with unmanned drones, submarines, satellites, and cyber capabilities emerging as pivotal instruments. Non-state actors, exemplified by Hizbullah for Iran and the Wagner group for Russia, contribute to the evolving dynamics of hard power. Simultaneously, the contours of soft power have transformed. The U.S. and the West no longer exclusively define global culture, with AI-powered tools enabling diverse cultural contributions from Indian Bollywood movies, Turkish dramas, South Korean soap operas, European music, and the ubiquitous Chinese TikTok.
Geoeconomic shifts are evident as well. I anticipate the gradual demise of the US dollar as the predominant global trade currency, making way for a basket comprising the Euro, Japanese Yen, Chinese Renminbi, and American Dollar. Such a shift could have severe repercussions for the US economy, affecting treasury bonds and investor interest, given the nation’s escalating budget deficits. Meanwhile, the geopolitical influence of oil and gas has waned, replaced by the strategic importance of food and rare earth metals, exemplified by the Ukraine conflict’s impact on wheat prices and Indonesia’s temporary palm oil export ban impacting household grocery budgets.
Technological advancements, particularly in AI, quantum computing, and semiconductors, have reshaped global trade dynamics. Supply chains and manufacturing processes have dispersed across multiple countries, diluting the geopolitical sway of specific regions. A prime example is the US’s keen interest in safeguarding Taiwan, a semiconductor manufacturing hub critical to global technological advancements until at least 2040.
International organizations have witnessed a shift in influence. While the West previously wielded substantial control through UN Security Council vetoes, the effectiveness and credibility of the United Nations in resolving conflicts has diminished. Emerging regional platforms such as NATO, BRICS, SCO, MERCOSUR, AUKUS, and ASEAN are gaining prominence.
NATO will remain relevant for another decade because there is no other option. However, the inclusion of Sweden and Finland has increased risks for its survival. Expansion may not necessarily solve a geopolitical risk but in some cases, it can actually increase risk. The inclusion of Finland is one such risk generator. Russia will not accept NATO to breathe down its neck by granting membership to a bordering country that has historically been under its influence. The weight of history is in Russia’s favor. I expect Russia to check the resolve of NATO by becoming aggressive towards Finland, once Ukraine is firmly under its thumb. What will NATO do in that case? If they respond, it will start another global war, and if they don’t then NATO will die its natural death. They have created a checkmate for themselves without due consideration. In soccer, they call it an own goal. The other risk to NATO is Turkey. If she is not accepted into the EU, they may decide to leave the organization. NATO may survive beyond 2040, but it may evolve into something else. One possibility is to rename it and include Indo-Pacific countries as members along with Germany, the UK, France, and the US.
In terms of governance and internal stability, democracy is facing a crisis as a representative system of the people. There are many flaws in the Western democratic model. One of them is that a small but energetic group can tilt the results in their favor. Imagine a hotly contested election between Biden and Trump. Last time around the vote difference was 2.5% in favor of Biden. In the 2024 presidential elections, just 5% of voters who are committed to their cause can help bring Trump back into the white house. This flaw is fully exploited by the far right in Europe destabilizing the continent in the process. The system has to evolve to remove this flaw, or it will result in further erosion of governance and irreparable rupture of the social fabric.
Not just that there is a rise in one-party rule in many countries. In Russia we have the party of Putin; in Turkey party of Erdogan, in India party of Modi, and in Iran only Mullah can approve a candidate to be President. These are democratic countries but behave like a single-party country. In China, the communist party is not showing any sign of relinquishing its political control. This trend is expected to expand to other countries.
Bi-polar World Order
After discussing the components of power, we can now get down to the business of discussing specific countries and their influence. There are a handful of countries that can qualify on the above criteria to project global reach to fight, talk, and exert cultural influence. The two obvious ones are the USA and China. Both these countries are far ahead of other countries when measured on the scale of a global pole of influence. The second-tier countries that can align with one of the two poles to exert outsized influence are Japan, Russia, Iran, India, Turkey, the UK, Germany, and South Africa. I have dropped Brazil from my 2011 list because they are facing severe internal issues.
USA:
I predicted during the Presidency of George W Bush that the USA was a power in decline. That trend has continued, and I expect it to continue until 2035 and beyond. The US has aging leaders that are not equipped to handle global influence. The two likely Presidential candidates for 2024 are both over 75 years old and the median age of a US senator is 65. Society is experiencing political polarization that has made legislation and governance ineffective.
The justice system has taken a hit as Supreme Court judges are driven by ideological pinning rather than the merits of a case.
American weaponry and military capabilities are outdated as evident from failures in Vietnam, Iraq, and Afghanistan. Its weapons are no longer the best and most innovative.
Its diplomats are ineffective as evident from the failure of the Abraham Accords and Ukraine war. It is increasingly absent from many diplomatic tables. And its hold on global organizations and the economy is waning as evident from the failure of sanctions on Russia and Iran.
It is no longer a leader in technology innovation although it is still ahead in many ways, the gap is reducing fast. The key reason for its slow decline in research and innovation is that it is no longer the destination of choice for the brightest minds. Its infrastructure is dilapidated and slow moving.
It can turn around only if it takes urgent steps to revive the American dream. The dream has been on deathbed since 911. The country erected a memorial tower in place of the terrorist-destroyed trade Twin Towers. But it has ignored to revive the American Dream.
China:
China has exponentially grown its global reach and influence since my foreign policy paper was published in 2011. It has a single-party rule that has produced peaceful succession from one leader to another. That chain of succession was broken when President Xi overthrew the two-term limit and extended his presidency to an unprecedented third term. It is yet to be seen whether the chain of succession can be reestablished after Xi. It carries substantial political risk for the country. President Xi can rule for another decade, considering he is 70, but there is no clarity beyond him. Under his guidance, the diplomatic and trade outreach has grown substantially.
The justice system is not open to reform and criticism. It is driven by the motivation to safeguard socialist ideology and its proceedings lack transparency. It seems the interests of the State take precedence over imparting justice.
China is no longer just the factory floor to produce low-cost commodity products. They have transitioned into a knowledge and innovation economy. TikTok, Ali Baba, Huawei, BYD are global brands. China has also become a world leader in some sectors. It has become the largest exporter of electric cars, solar panels, and bullet trains. It is also the world leader in AI and quantum computing. China is also on a hunt for talent around the world.
Its diplomats have earned respect as peacemakers when they successfully negotiated an agreement between long-term rivals like Iran and Saudi Arabia. It has also projected an image of benign power that does not interfere in the internal affairs of other countries and wants to do trade. Its Belt & Road initiative has been expanding and is a key component of the Chinese-dominated new world order.
Chinese military remains untested for global dominance although they have shown willingness for aggression in border disputes with India, control of the South China Sea, and reunification of Taiwan.
Russia:
Russia is no longer a global power, but it is a central Asian behemoth. She has not forgotten the invasion of its lands by Europeans Napoleon and Hitler. In their view, there is a third assault on their interests, and this time around Napoleon, Hitler, George Washington, and Churchill have joined hands. For them, it is an existential threat. They will go to any length to preserve themselves. We must not forget Russians chose to burn Moscow when it was not possible to prevent occupation by the Napoleonic forces. Unlike the French, who preferred to let Germany take over Paris in the Second World War.
They are a leading exporter of oil and gas to Europe and grains to Africa and Asia. This gives them substantial clout to be relevant to world affairs when coupled with veto power in the UN SC. It is in their interest to preserve the UN as a world body.
UK:
The UK has to learn from Singapore and remake itself as a center for trade and finance. This is their only option to have some influence in world affairs. Like Russia, they would also like to preserve the UN because without it they have zero influence. They made a historic blunder of leaving Europe.
Germany:
Germany is confused and nervous. They need peace in their backyard to keep the economy growing and people prosperous. They need access to large markets in China and India for the exports of products. They had to curtail purchasing Russian gas supplies to appease Americans. They can no longer rely on NATO and the US for security, but any hint of recreating their military power makes all of Europe nervous. The reason is understandable, the First and Second World Wars that devastated Europe, part of Asia, and Northern Africa were started by Germany. Their governance model is not producing high-caliber leaders. Another Angela Merkel is not on the horizon, she stepped off the stage at the wrong time.
Turkey:
Turkey is growing in its diplomatic clout, but their economy and governance are in shambles. Erdogan is growing old and has severely damaged the democratic system to produce a capable successor. Military rule will not be acceptable to people. Internal divisions and wars on their borders are also keeping them down. Turkey, I feel, will leave NATO if they are not accepted in the EU. Their other option is to turn East and claim leadership of the Turkic ethnicity of central Asia and Muslims at large. There is a vacuum in both that Turkey can aspire to fill, they will face opposition from Saudi Arabia, Iran, and Egypt.
Japan:
Japan has a birth problem. It is a dying nation. Their birth rate is low, and the median age has risen to over 49. This demographic crisis is unsustainable. If they did not revive their birth rates, they could eventually disappear as a nation. It will not be the first time for a nation to disappear. History is replete with such events. Japan has to make a tough choice. Whether to become a military power or not? They are no longer relying on the US for their long-term security. They will try to use trade and alliances in the short term, but in the long term, they have no choice but to protect themselves.
India:
India is too vast and diverse to keep united in the long term. It has oscillated between being held together by an Iron hand of foreign invaders or divided into small princely states. India has gained from the contest between the US and China without taking sides. They became a choice destination for US corporations leaving China, but they have so far not strategically aligned themselves with the West.
They have long-standing close relations with two significant European adversaries i.e. Iran and Russia. They will continue playing this game until they gain strength economically, militarily, and diplomatically.
They are eager to become members of UNSC. If it does not happen, they can be one of the powers that demand the dismantling of UNSC and empowering the UN General Assembly.
South Africa:
South Africa is the largest economic power in Africa. They are significantly influential in the Southern Hemisphere in collaboration with Brazil and would like to continue playing that role.
War or Peace?
The prospect of a world war before 2035 looms, driven by the shifting global balance of power. The US, grappling with decline, might resort to conflict to disrupt the ascent of other powers, potentially in North Korea or Taiwan. China, aspiring to avoid direct conflict, may manipulate regional proxies like Russia or Iran to engage the West. A delicate balance is crucial, as historical precedents caution against attempts to alter the natural flow of global dynamics.
In conclusion, accommodating Russia and Iran is imperative for the US and Europe to navigate the evolving world order successfully. Failure to do so may inadvertently bolster their rivals, escalating geopolitical tensions and reshaping the global landscape in unforeseen ways. The journey into the next phase of the 21st century promises to be intricate, requiring adept diplomacy, strategic foresight, and a commitment to fostering international collaboration.