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Diplomacy
ASEAN Flags Ribbon , AEC (Asean Economics Community) Flags10 Countries , ASEAN Flags Waving Vector Illustration .

New U.S. strategy towards ASEAN: caution, info-colonialism!

by Ksenia Muratshina

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском The implementation of yet another U.S. initiative may allow it to interfere in the information policy of ASEAN and control the cyberspace of all of Southeast Asia. Two sides of the same summit The annual summit of the Association of Southeast Asian Nations (ASEAN) and the United States was held in Vientiane in October. Meetings in this format are routine for ASEAN and are held with each of the non-regional powers, i.e. the dialogue partners of the association. They discuss plans for cooperation and exchange views on international issues. This time, the U.S., represented by A. Blinken, again tried to use dialogue to impose its vision of global issues. The statements of the US Secretary of State were anti-Russian, anti-Chinese and anti-North Korean in nature, and were aimed at increasing tensions vis-à-vis the South China Sea and the internal political situation in Myanmar. The timing of the meeting was no accident; it took place before the East Asia Summit (EAS), which is a platform for multilateral negotiations between ASEAN countries and external partners. In this way, Washington hoped to force representatives of Southeast Asian states to reconsider the agenda of the EAS and planned to use the upcoming event to provoke regional conflicts and consolidate their role as the ‘chief gendarme’ of the Asia-Pacific or Indo-Pacific region. However, as the EAS showed, the U.S. failed to do so: no one except U.S. allies supported the attempts to undermine the regional architecture of security and cooperation. Following the results of the US-ASEAN summit, the divergence of views was also notable. The parties did not adopt any joint document of a political nature. Such a result was natural; for ASEAN, any external imposition of views is traditionally unacceptable. In general, the ASEAN leaders’ talks with Anthony Blinken were held among other meetings with Russia, India, China etc., and they would not have attracted much attention if a very narrow joint statement (‘Statement on Promoting Safe, Secure and Trustworthy Artificial Intelligence’ (AI)) had not been adopted in the aftermaths. With good intention According to the terms of this statement, under the plausible pretext of ‘achieving the UN Sustainable Development Goals’, the United States intends to implement a whole range of plans together with ASEAN. Thus, it is planned to ‘discuss the further development of ASEAN’s AI projects’ (although, why should ASEAN discuss its plans with someone?), ‘interaction with the ASEAN Working Group on AI Governance (again, a direct intention to enter the decision-making process in the association), ‘creating an ASEAN roadmap for responsible AI’ (and, thus, inclusion in the internal planning process of its activities). In addition, the parties will ‘cooperate on approaches and standards in the field of AI’ (these approaches and standards will be based on similar U.S. ones), ‘knowledge exchange, technology transfer’ (the saying about ‘free cheese in a mousetrap’ is involuntarily recalled), ‘strengthening the collective digital and cyber potential’ (again based on the United States and built according to their rules), ‘the expansion of education in the field of AI’ (also according to U.S. norms) and ‘the development of interrelated approaches to AI management’ (AI management is a serious issue and it must be understood that external participation equals a direct threat to national sovereignty). Even more ambitious tasks include ‘supporting the development of national digital and AI strategies, discussing its management and regulation’ (for the United States, gaining access to national strategies will provide new tools for interfering in the internal affairs of others), ‘implementing initiatives in cooperation with the ministries of digital development of ASEAN countries’, as well as ‘ensuring information security support for the ASEAN Digital Economy Framework’ (its adoption is planned in 2025; here the U.S. is again interfering in intra-ASEAN affairs). We were not snubbed of the traditional American demagoguery in the field of ‘human rights’. The statement supposes ‘ensuring human rights and protection from all forms of discrimination and prejudice when using AI’ and  ‘ensuring the inclusiveness and accessibility of AI’ in the near future. Whether the mass use of AI will be safe for the population is a question the authors of the document are not considering, instead occupying themselves with other tasks. Another component is ‘dealing with foreign manipulation of information, disinformation and training in the field of technologies to counter this’ (of course, the U.S. initiators do not doubt their right to assign labels to information sources). Finally, it is expected to ‘stimulate the improvement of the population’s digital literacy via the private sector’, although, it would seem, in such sensitive areas as AI, digital technologies and cyberspace, only the state can protect the interests of its citizens. The name of the game When analysing these agreements, it becomes clear that the United States is aiming to take control not only of the economy or technology, but of the information space of Southeast Asia and the information policy of both ASEAN as a whole and individual members countries and their national sectoral departments. Such a radical deepening of interaction includes direct interference in the affairs of the association – unprecedented in its arrogance and openness – and searching for opportunities to reduce the role of states in controlling AI and the cyber sphere, as well as access to scientific and technological work of Southeast Asian countries in the field of AI and monopolisation of the Southeast Asian media sphere, which is absolutely a colonial approach of deciding which information people from ASEAN are allowed to read and see and which is declared ‘foreign manipulation’. The U.S. has already demonstrated its seriousness. On November 1, Rumman Chowdhury, an AI specialist and the U.S. Special Representative for Science, flew to the ASEAN secretariat in Jakarta to remind Southeast Asian countries of the need to implement the joint statement. Here it should be understood that U.S. sectoral cooperation with ASEAN will be executed by a system of highly specialised institutions that objectively does not depend on the change of the presidential administration. Agreements have been made, obligations have been established and the implementation mechanism has been launched. Moreover, the U.S. will have a separate and individual approach to each country in terms of fulfilling and implementing these agreements. It is planned to work with the sectoral ‘digital’ ministries of the Southeast Asian states, which is nothing more than the selection of loyal future agents of influence. However, the question is to what extent the political and expert circles in Southeast Asia understand the long-term risks of granting a foreign partner large-scale access to the sensitive cyber sphere – even one whose interests in the region have long been known to everyone: inciting conflicts, ‘dividing and ruling’, searching for and luring highly qualified specialists (brain drain), exclusively imposing their own view on international issues, linking countries and markets to their technologies with the transfer of all kinds of useful data to intelligence services. *  *  * It would seem that ASEAN has always opposed neo-colonialism and supported a multi-vector course, equidistant from any external interests of its dialogue partners. Most likely, the association could only allow the appearance of info-colonial encroachments from its U.S. counterpart due to hopes for disinterested financing of its development from the United States (which in itself sounds like an oxymoron) and counting on some kind of abstract technology transfer. However, the consequences of the adoption of U.S. policy by Southeast Asian countries (if they do not ‘hit the brakes’ on the commitments they have made) could be deplorable, disastrous for their digital sovereignty, technological development and their independent course in general.

Diplomacy
5-9-2023, Russian President Vladimir Putin, leaders: Uzbekistan Shavkat Merziyoev Kyrgyzstan Sadyr Japarov Tajikistan Emomali Rahmon Armenia Nikol Pashinyan Kazakhstan Kosym Tokaev Turkmenistan Serda

The World From the Bottom Up or The Masterpieces of Eurasian Architecture

by Oleg Barabanov , Timofei Bordachev , Fyodor Lukyanov , Andrey Sushentsov , Ivan Timofeev

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском If there is a central theme to this year, it is the world getting accustomed to the lack of predetermined scenarios. Discussions focusing on the international order are fading; the former order no longer functions, and there is no knowledge of what the new one, if it ever materializes, will look like. When the authors of an annual Valdai report suggested1 several years ago that order, as we know it, was unlikely to ever emerge, their hypothesis drew restrained comments at best. How can we do without order?  However, the habit of living in a structured international system was formed recently by historical standards. Unregulated international relations have marked political history. These relations took shape in the process of interaction between the countries and quickly changed. What we now habitually call a multipolar or a polycentric world is reminiscent, in its form, of a return to an environment last seen before the Great War that broke out in the early 20th century. However, such parallels are misleading because international relations today are structured in a whole different manner.  First, despite stark differences, the world remains an integral and interconnected place. Conflicts do not sever ties but warp them, quite badly at times.  Second, compared to the turn of the 19th and the 20th centuries, or even 1945 when the most robust so far known global order was established, the number of significant players influencing international processes has increased by order of magnitude. That includes more than just major countries.  Previous approaches to establishing the global balance through peaceful or military means are no longer effective, and the countries have yet to see innovative tools make their way to their arsenals. We will be compelled to make do with what we have and accommodate this toolset to deal with the changed circumstances. This will require everyone to re-interpret the ongoing developments and to forgo the stereotypes that defined our perspectives in the previous era. In last year’s report,2 we suggested that the impossibility of structuring international relations around a hierarchy-based approach would be a hallmark of the coming era. The ensuing events showed that things have indeed taken this course.   Avert an all-out cold war.  In 1945, when the international order that we view to this day as exemplary was emerging, writer and essayist George Orwell made a disappointing conclusion in his essay You and the Atomic Bomb3 to the effect that the formidable military capabilities of the countries with massive nuclear arsenals made perpetual cold war unavoidable. This goes beyond confrontation between them and includes − an even more consequential factor − their confrontation with other countries that do not possess weapons of mass destruction. In the hierarchy of international priorities, the relations between the great nuclear powers will always top other kinds of relations, and their conflict will prevent a system of cooperation, global or regional, from ever being created and will only allow creating a system of competition instead. All initiatives put forth by these powers bear the imprint of their relations with those who match them in destructive capabilities. Thus, international politics appeared to him doomed to a perpetual state of not a war, but “peace that is no peace.”  So far, the fate of global stability has indeed been falling prey to differences among the most powerful countries, such as the United States, Russia, and China. But does this provide enough ground to believe we should “bear those ills we have than fly to others that we know not of?”4 Especially so since, even amidst intense confrontation, the world is not splitting into rivalling blocs as it did in the past century. The bloc system experience, like that of the Western community, is not replicated despite its perceived success. This suggests that binding alliances marked by ideology and stern discipline are an exception than the rule. There is no indication that other countries are seeking to form alliances like the West in terms of like-mindedness.  New rules emerge from shifts in the balance of power and, if we take the modern-day world, the fact that small groups of countries are no longer able to tell the rest of the international community what to do. The drive for independence relying on mutual respect that we see in most countries around the world has become the structural foundation underlying an emerging regional and international order. Today’s situation is ironic. On the one hand, a profound shift is unfolding on the international stage. It is greater in size and depth than the previous one that took place in the late 1980s and early 1990s. On the other hand, these changes are not revolutionary by nature. They are not leading to collapse and evanescence, but rather to transformation of the erstwhile rules and norms. Truth be told, no one is really interested in seeing a radical scenario play out. The current and anticipated international escalation looks less like a premeditated strategy and more like an outcome of hare-brained actions or a lack of alternative ideas. The key point is that there is no going back, and what lies ahead will look nothing like recapitulation of the past.  There is a demand for stabilizing mechanisms that would not only expand existing capabilities of the countries, but also function as safeguards against the woefully tragic scenarios, such as those playing out around Ukraine and in the Middle East. The search for such mechanisms will be most widespread in Eurasia, which is the world’s largest continent in terms of its territory and population. This is where the most favorable prerequisites for that have developed. Eurasia’s connection to the rest of the world is so deep that Eurasian processes will have a decisive impact on the other parts of the planet and on approaches to addressing crucial security and sustainability issues, such as food, energy, and the environment. Development of each means security for everyone From the particular to the general  Building a Eurasian system of security cooperation, both as an ideal and a practical project, runs into numerous obstacles. Yet it is possible within this vast expanse, if the goals of each nation’s development can be prioritized over the factors that drive conflict and competition. In Greater Eurasia, conflicts impact only peripheral areas and do not go deep inside the territory, which means that preserving stability through leveraging new forms of security coordination appears quite achievable.  Global events of the past three years clearly show that individual countries’ push to pursue diverse paths of development and to avoid confinement within specific blocs is stronger than the inertia of division along ideological or even strategic lines. Even at the peak of the ideological and military rivalry in the latter half of the 20th century, many “third world” countries chose not to align with either side of the binary universe, even though the two opposing blocs formed the core of international politics. This reluctance has become even more natural now that rivalries have lost their structured character, and the ideology-driven attempts to divide the world into democracies and autocracies are artificial to the point where they fail to hold up to the international real-world test.  With varying degrees of confidence and assertiveness, most countries are upholding their right to their unique place in global affairs, aiming to determine their own paths to achieve their development and security goals. Modern history provides examples of cooperative initiatives aimed at shared prosperity, of which ASEAN is the best known one. Such cooperation is grounded in ruling out diktat in political matters and expanding practical interactions to address each country’s unique needs. These principles offer a starting point for reflections on what regional security might look like in the modern world. Collectively, regional security systems form a foundation of universal security.  Eurasia’s security is inseparable from global security, which makes it particularly special.  First, the security of Russia and China directly depends on their respective relations with the United States. This is a crucial element of international politics that defines its content. Accordingly, the strategic ambitions of the United States have a direct impact on Eurasian security. Furthermore, the western edge of Eurasia − Europe − remains part of the collective West and pursues its group interests.  Europe’s future is a crucial factor which will affect international politics in the decades to come. Even though the era of Europe as the global center is ending, it remains an attractive partner for achieving development goals in other regions due to its economic power and technological capacities. The 2022−2024 events reinforced transatlantic ties and diminished Europe’s agency in international affairs, as the latter continued to follow unwaveringly in the wake of US politics. However, given the pace and scale of global changes, this situation may not last forever. The key Eurasian powers are operating on the premise that the positioning of Europe can shift in the coming years in the wake of the international system transformations, potentially drawing some European countries into embracing broader Eurasian projects. Second, the security of a group of Eurasian countries also makes up part of the collective security. Many of these countries find key financial, technological, and cultural resources for their development outside of Eurasia. They also play important roles in international politics and have influence on numerous developments around the world. Their global importance and involvement in the highest level “great game” ensure that they have a stake in maintaining peace in Eurasia. This helps explain the relative stability within Eurasia’s borders and supports the efforts to establish common security platforms in Eurasia. Notably, not a single major military conflict involving Eurasian countries has ever broken out after WWII (the western edge is an exception due to the European “zero-sum game” approach that has dominated that part of the world for centuries).  The historical paths and itineraries across Eurasia and around it, which predate the Age of Discovery and European colonization, are being revitalized as the global political and economic system continues to diversify. Ironically, the punitive economic measures imposed by the United States and its allies on Russia help develop alternative global trade networks, promote economic flexibility and the search for alternative solutions.  Third, Eurasia objectively covers a sizable portion of habitable land and is home to multiple civilizations and dozens of countries that accommodate 70 percent of the world’s population. It is no coincidence that this region intrigued classical geopolitical theorists who saw Eurasia’s Heartland as the center of global processes.  Eurasian security is inseparable from global security, and its specific principles, mechanisms for country-to-country cooperation, and institutional forms can hardly be defined specifically for just one region. Eurasia is complex in terms of country-to-country relations, but holds vast potential, given its quest for a sustainable interrelations system and absence of obsolete institutions. It has the potential to develop alternatives to the principles and institutional forms of European security,5 which cannot be universal due to Europe’s unique cultural and historical background. The Helsinki framework, which created the Conference and then the Organization for Security and Cooperation in Europe (OSCE) was Europe’s most significant achievement in establishing security for all. However, the OSCE was unable to adapt to the new balance of power following the 1946–1990 Cold War, which spawned ongoing major military and political crisis in Europe.  From the general to the particular  Eurasia is a region that may give birth to a new concept of international security. This potential is supported by, on the one hand, its inseparability from global security and development issues and, on the other hand, by the countries’ interest in a stable environment that is free from existential threats. Eurasia’s position in the global economy does not require nations to unite solely to reap the benefits of unification, as is the case with the Western countries. However, the creation of well-defined geopolitical and civilizational barriers is unlikely in Eurasia. The continent’s vastly different experiences in new international trends may eventually provide a foundation for global transformation.  Factors that underlie Eurasian security are the following:  Recognition of the continent’s spatial integrity and the impossibility of drawing dividing lines there.  Acknowledgment of shared interests and collective leadership.  Political equality of all countries of the region, regardless of their size or potential. There are no revolutionary or revisionist countries in Eurasia that feel compelled to export their political systems (exporting socio-political models as the Soviet Union or the United States did) to survive. Radical ideas come not from the countries, but from transborder extremist groups. Containing and eliminating them is a common objective.  The Eurasian regional security system aims to address issues separately from global security concerns which are, according to Orwell, dominated by relations between major nuclear powers, and to enhance the region’s resilience to external challenges, which implies resilience of each country. Defence against external threats and preventing internal conflict from getting worse are achieved through multilateral cooperation rather than rigid bloc discipline. A practical objective at hand is to identify external threats that will not force Eurasian countries into picking sides in an Orwellian Cold War with the involvement of nuclear powers.  A shared understanding that independent countries form the basis of order helps articulate the core principle of mutual renunciation of any moves that may violate the region’s integrity and equality of the countries in that region. The core value lies in unconditional respect for each other’s socio-political systems and firm rejection of the efforts to change them. This approach may seem self-evident and is in stark contrast with the practices used in the 1990s–2010s when forceful transformation of sovereign countries with active external involvement up to military intervention was cast as a standard approach by Western political leaders.  Sovereign equality enables justice, a concept that, while subjective, is central to international politics. Future international order will center on ensuring just relations, even if past institutions, which were designed to smooth power imbalances, get dismantled. The more the future rules can guarantee fairness, the more effective they will be at preventing armed conflicts. The collective goal is to uphold justice regarding the core interests and values of all Eurasian nations. Not like in Europe  It is unrealistic to expect that the next stage will somehow replicate the circumstances which were typical of Europe in the past centuries or decades. Speaking of future regional security, it is essential to break free from traditional patterns of perception and all-too-familiar solutions. Unlike Europe where the interests of Russia and the West overlap, Eurasia lacks a common fundamental challenge that could be resolved by establishing a Helsinki-like model of collective regional security. In this case, there will be no opposing great powers or blocs, whose balance will prioritize interests. In Eurasia, there are no second-grade countries or second-grade interests, because even the largest countries are incapable of imposing their own rules on any other country.  As we have seen, the balance of power underlying the European system cannot be considered a solution simply because major Eurasian countries do not compete in issues that are critical to their survival. In other words, the balance of power and influence between Russia, China, and India − even if tensions arise occasionally − does not affect their chances of survival or their chances to achieve their development goals. The differences implicating major Eurasian powers do exist, but they manifest on a global level of international politics. They are not of paramount importance in Eurasia, which is critically important when it comes to cooperation. Power and its emotions  Even though Eurasia’s make-up is unique, and it is an integral part of the international system, it is not detached from the international context and historical patterns. After a period of high regulation and reliance on institutions (this order of things was established in 1945), international relations have reverted to the “original settings.” Power remains a key category, and the use (or the threat of use) of power is back in demand. Moreover, the emotions and personal qualities of leaders, combined with national strategic cultures, now shape interactions among major powers even more than the established order, norms, and rules that date back to the era of the bipolar face-off, which persisted throughout the transitional period.  Fear and anger are two emotions that matter in international affairs. In addition to existing circumstances, they are identified in each case by a nation’s historical experience. Fear, ranging from apprehension to anxiety and dread, is one primary driver behind the countries’ behaviour.6 Anger, spanning from irritation and resentment to rage, also drives international relations and manifests itself in acts of retribution and violence that include terrorism. Fear and anger often drive not only political leaders, but entire societies as well. These emotions impact the way security is arranged and understood.  Occasionally, countries are observing the evolution of international processes from a position of force and the position of force-derived emotions, such as tranquility and firmness. The sense of power is a vital driving force in relations among leading military powers. The basic emotions such as fear and anger, as well as tranquility rooted in the sense of one’s own superior strength once again, as in previous historical eras, determine the choice between two key strategies: annihilation and positional strategy.7  The annihilation strategy invariably relies on significant superiority in assets and military force, initiative-taking moves, and swift overpowering of an opponent. By contrast, the positional strategy concedes the initiative and allows the advancing party to act. It relies on the importance of concentrating and gradually building the resources up. Anyone employing this strategy avoids decisive battles for as long as they can and engages only when they believe they cannot lose. Typically, time favors those who employ positional strategy.  Traditionally, most Eurasian countries prioritize the positional strategy. Classical Eurasian military thought is captured, for example, in the Chinese treatise The Art of War, which outlines the principles of positional strategy: “Thus the highest form of generalship is to balk the enemy’s plans, the next best is to prevent the junction of the enemy’s forces, the next in order is to attack the enemy’s army in the fi eld.”8 In Russia, patience and willingness to endure lengthy confrontations have always been part of the military and political tradition, which manifested itself, for example, in the tactic of medieval Moscow princes or the generals of the 1812 Patriotic War.  These speculations are related to the ongoing international developments. Amid profound shifts in the balance of power, the United States, striving to maintain its hegemony, increasingly chooses offensive and provocative policies. This policy is not rooted in quiet confidence in its own strength but stems from anger and frustration at being challenged by its antagonists and resentment aimed at the internal opposition that underestimates the scale of this challenge. In addition to anger, there is fear and anxiety that the unfolding trends could lead to a scenario that is unfamiliar and unsettling for the United States where the balance of power will shift towards East.  The clash of emotions is a hallmark of the post-institutional world. 9 A different conference  Eurasia lacks conditions where any power can become dominant. This does not mean, however, that rivalry is out of the question here. Each power pursues its own interests, and balances of power will form over time and with difficulty. However, Eurasia’s advantage lies in the fact that − with few exceptions − there are no long-standing or deeply rooted conflicts between the countries overfilled with fear or anger. Major Eurasian powers do not have an objective need to be at feud with each other to achieve their vital goals. Vast and rich expanses of land can accommodate diverse cultures, civilizations, and foreign policy priorities. This is why Eurasia can reach a balance relying on a patient positional strategy rooted in quiet confidence, firmness, and mutual interest.  The Eurasian collective security system cannot rely on the principles of a military alliance with clear-cut obligations. Bloc discipline or a rigid institutional structure are ruled out as well. As mentioned above, the model established in Europe in the 1970s as part of the pan-European process cannot be used, either. However, the concept of a “conference on security and cooperation,” which emerged back in the day, fits the Eurasian space well as a mechanism for ongoing multilateral consultations involving interaction on all issues. The key difference from Europe is that the CSCE/ OSCE was originally created to defi ne spheres of influence in Europe and later morphed into a tool to maintain Atlantic monopoly. Neither is a viable option in Eurasia. An equal distribution of responsibility for stability and security among Eurasian powers is based on forgoing any nation’s dominance.  The principles of polycentricity, first outlined in the 1997 Russia China Joint Declaration on a Multipolar World and the Establishment of a New International Order,10 include non-interference in domestic affairs, respect for mutual interests, equality, and a commitment to a collective approach to addressing security issues, such as demilitarization of shared borders or provision of security guarantees to small and medium-sized buffer countries located between major powers. These principles are now taking on a multilateral dimension. The Eurasian security cannot rely on a closed architecture. It is embodied not in a single international organization, but rather in a network of bilateral and multilateral agreements and diverse associations that collectively cover all (not just military and political) aspects of collective security. Downsizing the presence of external forces, which leverage fears and anger of small and medium-sized countries to stir up tensions in Eurasia, and mitigating chances for their intervention is an important goal. The security system will focus on resolving all major conflicts with the involvement of regional actors.  The mutual nuclear deterrence between major powers makes achieving absolute political goals an unviable proposition. Now is the time for relative victories; achieving an absolute victory is out of the question. All major conflicts that we observe in Eurasia, such as between Russia and the West, the United States and China, India and Pakistan, and Iran and Israel, to name a few, are rooted in positional confrontations, where a strategy of annihilation is fraught with high risks and is largely unproductive. The architecture of Eurasian security in its military and political and force-based aspect will rely precisely on the sense of quiet confidence in one’s strength and the general drift of international relations. Security and advantages  Modern-day international security is a complex construct that transcends the military and political framework. Just like competition embraces all spheres of activity, including culture and the economy, so too does security with its compound nature. Common sense suggests that economic cooperation creates a foundation for confrontation-free political relations. However, things tend to be more complicated in the real world.  The Russia-EU economic relations were remarkably strong. Even in 2022, trade amounted to $258.6 billion.11 The EU was Russia’s key trading partner and the primary market for its energy. Deeper integration, such as allowing Russian companies to own EU pipeline asset shares, or shares in individual companies, such as Opel, was held back for political reasons long before Ukraine crisis broke out in 2014.12 High trade volumes did nothing to prevent degradation, and the political dialogue collapsed. Russia-Ukraine relations were likewise marked by elevated levels of mutual dependency even after 2014. In 2021, trade amounted to $12.2 billion, which did not alleviate, but rather exacerbated political differences. A peaceful matter about exclusivity of economic relations with Europe dating back to the early 2010s led to an onset of a deep crisis that ended in an armed conflict. The highest level of economic interdependence between China and the United States (with trade hitting $690 billion in 2023)13 goes hand in hand with an escalation of political competition and Washington’s attempts to throw a wrench in China’s technological growth, including by way of imposing restrictive measures.14 Conversely, complex political relations between China and India are unfolding amid trade numbers in excess of $100 billion.15  Examples of the non-linear relationship between the economy and international politics, particularly in matters of security, abound. Economic benefits may create enabling conditions for political cooperation but cannot shield countries against confrontation when it comes to fundamental security issues. Politicization and ways to fight it.  The modern-day world economy is highly globalized in terms of finance and trade. Globalization has significantly brought down costs, streamlined supply chains, and integrated multiple economies into technological and value-added chains, thus promoting their growth and modernization. The US dollar has become a convenient tool for making international payments and creating reserves, while technological platforms have brought countries together into a single economic organism. However, the “vital organs” of the global networks in the form of financial, technological, and communication hubs have remained under the jurisdiction of Western, primarily US, state bodies. The United States is losing credibility, because it takes advantage of economic interdependency networks for political gains, yet there are no full-fledged alternative solutions in sight.16 With the US dollar dominating the international scene, disconnecting individual companies or individuals from payments in dollars can result in heavy economic damage. According to SWIFT, the US dollar accounts for 48.03 percent of transactions handled by this international payments network, while the share of euro has plummeted to 23.2 percent.17 Blocking financial sanctions feature prominently in the US toolset, and are widely used by the European Union, the United Kingdom, Canada, and other countries as well. Russia has become a primary target for such measures, although individuals from Iran, North Korea, China, and even US allies and partners like Türkiye or the UAE are also on the receiving end of these sanctions, albeit to a lesser extent. Trade and technological ties have become hot-button political issues as well. Sanctions on Russia include sweeping bans on exports and imports. US legislation imposes export control compliance on countries that use US-made technologies, manufacturing equipment, and software. Import restrictions cover Russian petroleum, refined products, gold, diamonds, steel, and other products. Export controls regarding China, especially in electronics and telecommunications, are tightening. Chinese electronic services are banned in the United States and some companies face contract restrictions in Western countries. Iran is under a total exports and imports ban, with even stricter bans imposed on North Korea. Even EU companies are forced to comply with the US export controls to avoid secondary sanctions.  Transport and digital infrastructure are affected as well. Tools include setting price thresholds for transporting Russian oil, sanctions for sizable transactions with Iran’s oil sector, and restrictions on the use of maritime space and airspace, ports, airports, gateways, and other infrastructure facilities. Sanctioned individuals are cut off from access to what are now customary services, such as email, audio, and video file aggregators, not to mention more applied online solutions in the sphere of engineering and other technical areas.  The targeted countries do provide a response. Russia and China have incorporated instruments to block financial sanctions into their legislation. Russia has imposed a ban on exports of manufacturing equipment and has implemented extraordinary measures against economic agents from unfriendly countries. China is implementing a “dual circulation” system in strategic economic areas and investing in developing its own technology. Iran and even more so North Korea have long lived under partial or near-total autarky. The US allies are pondering diversification of financial assets. Back to market  The above developments have become quite widespread and continue to expand. They transfer the cutthroat zero-sum-game-like military and political competition to the economy. It cancels market principles that are based on mutual advantages. With the economic ties and interdependence networks weaponized, severing such ties or at least diversifying them appears a sensible response. Even if such steps are deficient from a market perspective, they are inevitable as a means of mitigating security risks.  Diversifying financial settlements implies using currencies other than the US dollar. National currencies partially address this issue. Using the renminbi in trade with China is a rational choice given the availability of a vast Chinese market. However, difficulties with investing rupees arise when it comes to Russia-India trade. Even more challenges arise from trade with less developed or more specialized economic systems. Strategically, a more universal mechanism is needed that could be used by several major economies, a BRICS mechanism.  The quest for ways to diversify payments is ongoing but expecting to see a “BRICS currency” emerge any time soon is premature for technical reasons, among other considerations. A better path is not to introduce an alternative reserve “anti-dollar,” but to create diverse bilateral or multilateral settlement arrangements that can bypass the US financial service monopoly. Russia is at the forefront of these efforts given its economy size and the number of sanctions imposed on it.  The same applies to creating innovative technological chains and domestic production capacities, as well as looking for alternative suppliers of manufactured goods and technologies. More recently, we had the chance to witness critical vulnerabilities when it comes to using products that include Western-made components. The domestically made substitutes can be less effective and more expensive but are unparalleled in terms of security. Amid bans and restrictions, such alternatives provide a solution, as does searching for replacements in other markets. Today, we see new chains pop up in places where they could hardly be expected to exist just a few years ago, especially when it comes to Russia-China relations. The US stick policy has defeated its purpose when economic agents around the globe became more ingenious and improved their economic flexibility. The infrastructure constraints have spurred the emergence or scaling of various phenomena, including “shadow” tanker fleets, alternative insurance systems, exchanges, communication, and online communication services.  Large transport projects in Eurasia are back on the agenda. Progress can be clearly seen in the North-South corridor. Moving such initiatives forward and creating a single system across the Eurasian region is a challenge, since Eurasian countries vary among themselves and maintain different relations with the United States and the Western countries. Significant economic disparities are also a factor to be reckoned with. More likely, such a system might incorporate a multitude of decentralized bilateral and multilateral formats and include financial tools for transactions between individual countries, as well as settlement systems for international associations such as BRICS, technological projects in niche areas, and targeted infrastructure solutions. However, the number of such innovations will inevitably give rise to qualitative changes.  The Eurasian economy will inevitably move away from the nets of West-centric interdependence which are being used as weapons. There is no need to forget them, but there is a need for backup tools as safeguards against arbitrary politicization. Eurasian economic security can be a flexible and decentralized set of mechanisms to reduce “dependence on interdependence.” While this may seem strange now, Eurasia could indeed become a flagship in global processes for returning to a much more market-based system of economic ties. Trust without coercion  Peaceful and productive relations between countries, whether bilateral or multilateral, can only be built on trust, which holds equally true for the prospects of development and matters of security.  What underlies trust in international relations? The Western answer to this question emphasizes cultural and ideological homogeneity, with the North Atlantic Alliance as a product of this approach. Modern Western countries display a strict bloc (self-)discipline about key international issues, which can be seen in their voting as one at the UN General Assembly and the G20, as well as their unified policies. Those who break the ranks, if any, are quickly put back in their place. On the face of it, this approach presents a competitive advantage in a multipolar world, which is further proof of internal strength. However, it lacks flexibility and is marked by ideology-driven dogmatism, which is an irritant for the non-Western world.  The World Majority countries18 (a term used in Russia to refer to non-Western Global South and Global East countries) do not have to follow bloc discipline. In the face of acute geopolitical conflicts that seek to split the modern world, this can be perceived as weakness, which fact is occasionally exploited by our Western counterparts, for example, on the G20 platform. However, this phenomenon should be approached differently: as a striving of various countries to achieve ultimate flexibility, which will allow them not to limit their options and to attract every development resource within their reach.  An important question arises in this regard, though: how can relationships be built within a diversified community torn by numerous contradictions? The tradition of independent cooperation among non-Western countries spans decades, and is rooted in the 1955 Bandung Conference, where the countries then categorized as part of the Third World or the Non-Aligned Movement proclaimed shared goals and objectives. The declaration affirmed a commitment to the common cause of resisting Western colonialism and imperialism, recognized the equality of all participants regardless of differences between them, and promoted shared interests in the name of development. Later, ASEAN adopted a similar set of principles, which has now made its way to BRICS and the SCO platforms.  Similar processes are observed in Africa as well. The Organization of African Unity (OAU) was based on shared values and objectives facing African countries, such as opposing colonialism and neo-colonialism. Statements by the OAU founding figures come to mind. Julius Nyerere, the first president of Tanzania, had the following to say: “Only with unity can we be sure that Africa really governs Africa.”19 In his opening remarks at the 1963 summit in Addis Ababa, where the OAU was founded, Emperor of Ethiopia Haile Selassie I also emphasized the importance of unity and setting aside individual differences to achieve solidarity: “Unity is the accepted goal. We argue about means we discuss alternative paths to the same objectives; we engage in debates about techniques and tactics. But when semantics are stripped away, there is little argument among us. We are determined to create a union of Africans.”20 This keynote address also highlighted the direct link between Africa and Asia: “We stand united with our Asian friends and brothers. Africa shares with Asia a common background of colonialism, of exploitation, of discrimination, of oppression. At Bandung, African and Asian states dedicated themselves to the liberation of their two continents from foreign domination and affirmed the right of all nations to develop in their own way, free of any external interference. The Bandung Declaration and the principles enunciated at that Conference remain today valid for us all.”21.     Much has changed since the Bandung and Addis Ababa conferences, and the world has changed out of recognition as well. Yet, the principles and goals declared there have not only remained relevant, but are now getting a second wind, especially because they imply mutual trust. As we sum up the experiences of Asian and African countries, we can pinpoint several principles that have been tested and approved by political practices in the non-Western world.  First: Recognizing a common goal, which unites different countries, and advancing towards it is an undeniable priority of their policies.  Second: Recognizing that differences should not hold back progress towards common goals.  Third: Acknowledging the fact that differences will not vanish. Each country has its unique specifics and a path to follow. Trust implies tolerance for differences and trade-offs to make sure differences do not lead to conflict.  Fourth: Flexible institutional and procedural mechanisms. The combination of trust and acknowledgment of differences takes rigid institutional frameworks and restrictions off the list of priorities. Coexistence and intertwining of different structures with various formats of membership and commitments thus becomes the practical outcome. Fifth: Gradual internal consolidation fostering the necessary conditions.  Sixth: Strengthening trust-based solidarity among the World Majority countries.  Seventh: Commitment to seeking local solutions to regional problems and addressing global issues as a sum of regional approaches to ensure that individual countries’ right to development is not hostage to new global constraints.  This path is longer and more complex than conventional bloc discipline, but, in an increasingly diverse world, it may be the only viable path, as fewer countries out there are willing to align in a single column. Is agreeing on the world order principles possible?  The post-World War II era brought forth new, never used approaches to structuring the international political and economic system. The achievements of the then created institutions are undeniable, yet no product is everlasting. The ongoing profound transformation of the global landscape calls for an effort to deeply rethink the accumulated experience rather than discard it. The events of the second quarter of the 21st century will not draw a line under the previous world structure but will pave the way to enhance and to adapt it to new realities. After all, the ideals that guided the architects of the post-war world remain in force and align with the global trends.  An open world space that ensures the rights to peaceful development, prosperity, and self-realization for all nations and countries is a shared goal in today’s world. In fact, we are now much closer to this goal than we were eighty years ago when the post-war order was being discussed. Back then, much of the world was still under colonial rule, and major powers were entrenched in systemic ideological confrontation. Today, neither of these conditions exists, though remnants of the past are still there. Addressing these remnants should be part of the efforts to create a renewed world architecture.  The emergence of new global organizations is highly unlikely. However, at the level of large regions, unilateral efforts will be insufficient, and the push for more stable forms of cooperation is likely to prevail. Currently, new constructs of that kind − the Shanghai Cooperation Organization, the Eurasian Economic Union, the Organization of Turkic States, and the Belt and Road Initiative − are being tested in Eurasia. All these initiatives, as well as any existing or future ones, are experimental in nature. Time will tell how effective and functional they really are. In the future, universal regional platforms might be able to encompass different cooperation institutions in specific areas whose objectives will not conflict with one another.  In the middle of the 20th century, the world was built from the top down, from the peak of the hierarchical pyramid down to its base. The new system will not be that consistent, but it will be far more democratic. It is being built from the bottom up and relies on self-organization and cooperation between countries within individual regions, where they must jointly address pressing, practical issues. If humanity avoids making the mistakes that will set it back as was the case in the past, then practical interaction at the regional level will give rise to a new system that will capture the planet’s complexity and diversity and be able to transform these qualities from obstacles on the way to development into a foundation for growth. References 1: Oleg Barabanov, Timofei Bordachev, Yaroslav Lissovolik, Fyodor Lukyanov, Andrey Sushentsov, Ivan Timofeev. Living in a Crumbling World. Valdai Club Annual Report. October 15, 2018. URL: https://valdaiclub. com/a/reports/living-in-a-crumbling-world/  2: Oleg Barabanov, Timofei Bordachev, Yaroslav Lissovolik, Fyodor Lukyanov, Andrey Sushentsov, Ivan Timofeev. Maturity Certificate, or the Order That Never Was. Valdai Club Annual Report. October 2, 2023. URL: https://valdaiclub.com/a/reports/maturity-certifi cate-or-the-order-that-never-was/ 3: Orwell G. You and the Atomic Bomb // Tribune, October 19, 1945.  4: William Shakespeare, Hamlet. 5: For four hundred years, the latter has served as a global security system: the Westphalian rules of the game, the balance of power, and Metternich’s rule, which holds that international security is achieved when one country considers the security concerns of another country as its own. 6: Pace M., Bilgic A. Studying Emotions in Security and Diplomacy: Where We Are Now and Challenges Ahead // Political Psychology. 2019. Vol. 40. No. 6. Pp. 1407–1417. Lebow R.N. Fear, Interest and Honour: Outlines of a Theory of International Relations // International Affairs. 2006. Vol. 82. No. 3. Pp. 431–448. 7: Стратегия в трудах военных классиков. Edited and commented by A. Svechin. Moscow, 1924; Carr A., Walsh B. The Fabian Strategy: How to Trade Space for Time // Comparative Strategy. 2022. Vol. 41. No. 1. Pp. 78–96.  8: From the treatise The Art of War commonly attributed to the legendary military commander and strategist Sun Tzu (6th-5th century BC).  9: Dominique Moisi. The Clash of Emotions. January 31, 2007. URL: https://www.ifri.org/en/external-articles/ clash-emotions 10: Russia-China Joint Declaration on a Multipolar World and the Establishment of a New International Order. URL: https://docs.cntd.ru/document/1902155?ysclid=m27d9a94wj720511004 11: Товарооборот между Россией и ЕС оказался максимальным за восемь лет. March 7, 2023. URL: https://www. rbc.ru/rbcfreenews/6406ceed9a7947b3912b3c98?ysclid=m0l0zgm3hl844648897  12: Беликов Д., Егикян С. Magna и Сбербанк прокатили мимо Opel. November 5, 2009. URL: https://www.kommersant.ru/doc/1268884?ysclid=m0l145995v673478546 13: Козлов А. Объем торговли США и Китая обновил исторический рекорд. February 10, 2023. URL: https:// www.vedomosti.ru/economics/articles/2023/02/10/962429-obem-torgovli-ssha-i-kitaya-obnovil-rekord  14: Тимофеев И.Н. Политика санкций США против Китая: сравнительный анализ //Мировая экономика и международные отношения. 2023.Т.67, №11. p. 70–79.  15: СМИ: Китай стал главным торговым партнером Индии в 2023–2024 финансовом году May 13, 2024. URL: https://tass.ru/ekonomika/20778213  16: See more about the phenomenon of weaponising interdependence in: Farrell H. and Newman A. Weaponized Interdependence. What Global Economic Networks Shape State Coercion // International Security. 2019. Vol. 44, No 1. P. 42–79. 17: Доля доллара в расчетах через систему SWIFT достигла рекордного уровня в 48%. September 28, 2023.URL: https://www.kommersant.ru/doc/6239234?ysclid=m0l1mzg1fu656162416 18: The World Majority and Its Interests. Valdai Club report, ed. by Timofei Bordachev. October 10, 24, URL: https://valdaiclub.com/a/reports/the-world-majority-and-its-interests/   19: Quotable Quotes of Mwalimu Julius K. Nyerere / collected from speeches and writings by Christopher C. Liundi. Dar es Salaam: Mkukina Nyota Publishers. 2022. P. 68. 20: Important Utterances of H.I.M. Emperor Haile Selassie I. 1963-1972. Addis Ababa: The Imperial Ethiopian Ministry of Information. 1972. P. 352.  21: Ibid. P. 361–362.

Diplomacy
18/11/2024. Rio De Janeiro, Brazil. Prime Minister Keir Starmer attends the opening session of the G20 Summit in Brazil. Picture by Simon Dawson / No 10 Downing Street

A review of the G20: more of the same or significant progress?

by Flavia Loss de Araujo

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском The outcome of the G20 leaders' summit held in Rio de Janeiro undoubtedly marks a series of victories for Brazilian foreign policy and also for the international community if we understand what is considered a success in terms of global governance. Firstly, the G20 summit declaration is a major achievement for Brazilian diplomacy, as it brings together twenty countries around agendas that not all of them support (such as human rights). Reaching this consensus required a year of intense negotiations to reach the final result. Brazil obtained support on the main themes it proposed: hunger and poverty, always off the radar of rich countries; sustainability; the bioeconomy , reaching the first multilateral treaty on the subject. Another consensus was the taxation of the super-rich , an issue that touches on the issues of inequality between countries and tax havens. Reaching the support of the G20 members around these proposals represented the reconstruction of the objectives of Brazilian foreign policy, which had been mocked during the Bolsonaro government, and crowned Brazil's return as a relevant country in the international community after years of self-inflicted isolation. Two other points that went unnoticed by some analyses is that the G20 summit allowed dialogue with Venezuela to return to normal, avoiding enormous damage to the Brazilian government and preserving good relations with the tumultuous neighboring country. And what can we say about the turbulent presence of the newest representative of the Latin American extreme right, Argentine President Javier Milei, who until the last moment tried to undo the consensus reached and was skillfully circumvented by Brazilian diplomacy? Returning to the proposals made by the presidency and supported by the other members of the group, are they “more of the same”, “undefined”, that do not change at the international level, as some analysts and part of the press said yesterday? Understanding the nature of international forums such as the G20 may answer this question. Outlined in 1999 and formalized in 2008, the G20 was created to bring together finance ministers and central bank governors from the twenty largest economies on the planet to discuss the financial crises of those periods. The crises of the 1990s, in particular, brought a new factor: it was the first time that economic problems in developing countries affected the central economies. It was therefore necessary to expand the discussions beyond the restricted Group of Seven (G7), a group of rich countries created in 1975, and to bring emerging economies to the negotiating table. Over the years, the G20 began to discuss other topics besides finance, and today sustainability is at the center of the work. The G20 emerged as an informal group with a flexible structure, dependent on a rotating presidency among its members to organize summits and working groups. In addition, it does not have a constitutive treaty and does not have the capacity to impose standards. When reading this brief description, most people wonder why a forum of this kind should exist if it “serves no purpose.” But informality and flexibility are a demand of the member countries that voluntarily chose to participate. These are the characteristics that allow ministers and other representatives of countries with divergent interests, such as the United States and Russia, to discuss issues that affect humanity, such as the eradication of hunger or climate change, for almost a year. The concrete actions that we so desperately need will depend on the efforts of each country and the corresponding pressure from their civil societies. The commitments exist, and now it is necessary to demand their implementation. Imagining a world without any kind of coordination is difficult because we have lived under the weak governance of the United Nations (UN) since the end of the Second World War, which, by the way, will be 80 years old in 2025. The memories of an international system under constant threat of global wars and in which common problems were not even discussed are a pale memory and, perhaps for this reason, so many people disdain the advances of international forums such as the G20. There are political forces today that oppose these alliances and the minimum level of global governance that we have managed to achieve, as Milei’s criticisms in his speech at the leaders’ meeting made clear. In line with the thinking of other far-right politicians, the Argentine president called global governance a “corset” that suffocates countries that think differently. It is contradictory that international regimes are criticized for restricting the freedom of States while at the same time being accused of being weak and ineffective, which demonstrates empty criticisms that serve only to encourage their supporters against imaginary enemies. Leaders like Donald Trump and Miley defend the “every man for himself” rule in international relations. This idea is gaining more and more followers among the people, a situation that makes declarations like the one by the G20, which defends basic principles of human rights and sustainability, an important manifesto for those who still defend an international order based on rules and cooperation. The Brazilian presidency has achieved important achievements for our foreign policy and also for the international order that it seeks to preserve.

Diplomacy
G20 Brazil 2024 Summit logo with country flags in the meeting room. Symbol of the Group of 20. Country leaders address issues related to the global economy - Rio de Janeiro, Brazil 07.23.2024

The G20 summit in Rio de Janeiro, Brazil: the moment of truth!

by Mohamed Lamine, KABA

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском In Rio de Janeiro, world leaders are gathering for a historic summit. The G20, the symbol of global governance, is at a crossroads. The planet is waiting. The climate, economic and geopolitical challenges are urgent.Since yesterday, at the G20 Summit in Rio de Janeiro, under the strategic engagement of Russia, Foreign MinisterSergey Lavrov, guided by the instructions of President Vladimir Putin, has been playing a key role in discussions on combating inequality, hunger and poverty, as well as reforming global institutions. Together with the BRICS Alliance, innovative initiatives are being put forward to strengthen economic cooperation and global stability, including sustainable development projects and strategic trade agreements. This Summit is proving to be a crucial platform for addressing pressing global challenges such as security and climate change, while potentially influencing global governance and international relations in the years to come.Geopolitical context of the summit, the madness of the Biden administrationAs the G20 group meets in Rio de Janeiro to reconcile the positions of the balance of power in the global chessboard, the recent antithetical decisions of the United States, held on the very eve of the summit and supported by France and Great Britain, are once again dispersing the positions to be reconciled. The Western minority, accustomed to living off the labor of the planetary majority, is lamentably trying to redefine the dynamics of the international community in its favor, by authorizing deep strikes on Russian territory. This approach, adopted by the Biden administration, reflects both madness and a vision of resistance in the face of the potential defeat of Ukraine and NATO allies against Russia, while seeking a reaction that could exacerbate global tensions. This audacious geopolitical calculation, perceived as a last-ditch attempt to consolidate Ukrainian positions before a potential change in American leadership, marks a turning point towards a dangerous escalation of hostilities. It can also be compared to a very big step taken towards the start of the Third World War.The 2024 G20 summit in Rio de Janeiro is therefore taking place in a complex geopolitical context, marked by key global issues. International conflicts, exacerbated in the Middle East, Ukraine, Sudan, and tensions over the role of the United States, France, Great Britain and the collective West are at the heart of discussions on global security. While António Guterres (UN Secretary-General) urges the G20 to adopt actions aligned with the UN Charter – although Western ambitions of domination are being challenged by the rise of the BRICS Alliance – the Western minority continues to pour oil on the embers precisely to satisfy its ambitions of eternal domination.The climate crisis, meanwhile, is forcing more ambitious policies, as the G20, responsible for 80% of global greenhouse gas emissions, must revise its commitment to limit global warming to 1.5°C. Also, growing economic inequality and the need for reforms to a perceived unfair international financial system underscore the urgency of changing the global financial architecture. Despite the political challenges, the summit embodies a push towards stronger multipolarism, with key players such as Sergei Lavrov, Xi Jinping, Recep Tayyip Erdoğan, etc., advocating for international cooperation. The political transition in the United States, with the imminent departure of Joe Biden and the possible return of Donald Trump to the White House, adds uncertainty, potentially impacting global cooperation and sustainability efforts. This nineteenth summit of the Group of Twenty powers (G20) is crucial to encouraging collective action in the face of complex challenges related to security, climate, the economy and international cooperation.Russia’s engagement in the world chessboardRussia’s participation in this Rio de Janeiro Summit is of major strategic importance. Led by Mr. Sergey Lavrov, Minister of Foreign Affairs of the Russian Federation, and mandated by the President of the Russian Federation, the Russian delegation demonstrates the country’s strong commitment to global discussions. Russia aims to take a leading position in addressing global challenges such as combating inequality, hunger and poverty, and reforming international institutions. Mr. Sergey Lavrov’s interventions at the plenary sessions are essential, while his bilateral talks with other world leaders could lead to decisive agreements, strengthening international relations. Capitalizing on its long history of global engagement, Russia is ideally placed to influence these crucial debates for the future of the planet.Positive initiatives of the BRICS Alliance in global dynamicsThe BRICS, originally composed of Brazil, Russia, India, China and South Africa – and expanded over time to BRICS+ – represent an undeniable emerging force in global economic cooperation, as demonstrated by their landmark initiatives at the Rio Summit yesterday. By establishing the New Development Bank, these nations are demonstrating their commitment to financing joint infrastructure projects, strengthening their synergy and displaying a clear desire for de-dollarization. The significant progress made in social security also demonstrates their determination to improve social protection on a large scale. Looking ahead, the BRICS countries are committed to driving reform of international financial institutions, placing their economic weight at the heart of global decisions, while working towards sustainable development and the fight against climate change. Speeches by representatives such as Mr. Sergei Lavrov at the summit captured attention, underscoring the BRICS’ determination to impact global governance and promote a more equitable and sustainable economic future.The impact of the summit on global governanceAs mentioned above, the G20 Summit in Rio de Janeiro, Brazil, represents a crucial opportunity to transform global governance and have a lasting impact on the future of the planet and international relations. Since yesterday, this strategic meeting has been addressing major issues such as the reform of international institutions, requested in particular by the member countries of the BRICS Alliance, the proactive fight against climate change to reduce greenhouse gas emissions, and international security requiring enhanced cooperation in the face of current geopolitical tensions. Through decisive decisions, the summit could establish a new multipolar world order and decide on the choice between cooperation and global confrontation. The challenge lies in reconciling national and global interests, strengthening trust between international partners, and finding innovative solutions to address the complex challenges of our era. The G20 Summit in Rio thus offers a unique platform for leaders to demonstrate their leadership and vision, thereby shaping a multipolar and sustainable future for future generations.It can be said that the 2024 edition of the G20 Summit in Rio de Janeiro marks a turning point where world leaders are called upon to choose: cooperation or confrontation, progress or stagnation. The future of the planet is now in their hands. Today’s decisions, contained in the Summit Declaration, will shape the world of tomorrow. History will judge.

Energy & Economics
Middle East Conflict. Conceptual photo

How might a wider Middle East conflict affect the global economy?

by Ahmet Kaya

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском The world economy is underperforming as a result of tight monetary policies, weaker global trade, a slowing Chinese economy and uncertainty around the US election. An escalation of conflict in the Middle East could increase uncertainties, harming inflation reduction efforts and hurting growth. It has been over a year since the Hamas-led attack on Israel. Israel’s response in Gaza has resulted in widespread destruction and significant loss of life. The conflict has since expanded beyond Gaza, involving the Houthis in Yemen, Hezbollah in Lebanon and Iranian strikes targeting Israel. In addition to the awful humanitarian cost of the conflicts, the war and the possibility of its further expansion pose significant repercussions for the global economy. This article discusses three potential ways in which the current conflict and a wider conflict in the Middle East could affect the global economy. Increased geopolitical uncertainties First and foremost, an escalation of the Middle East conflict could lead to greater geopolitical uncertainties. Figure 1 shows the evolution of the geopolitical risk (GPR) and geopolitical acts (GPRA) indices (Caldara and Iacoviello, 2022) – these are text-based measures of heightened uncertainties due to adverse geopolitical events such as wars, terrorism and international tensions. (See this article for more discussion about these measures.) Following the Hamas-led attack on 7 October 2023, both the overall GPR index and its ‘war and terror acts’ component spiked strongly, to a level higher than that seen during the ISIS attack in Paris in November 2015. Both indices eased significantly in the months following October 2023 despite the continuation of the conflict. But they jumped again following Israel’s attack on southern Lebanon in September 2024. As of mid-October 2024, the GPR and GPRA remain, respectively, 21% and 35% higher than their historical averages.   What might be the consequences of such elevated levels of risk? Research tells us that higher geopolitical risk raises oil prices (Mignon and Saadaoui, 2024). It also reduces global investment and increases inflation (Caldara et al, 2022). Greater geopolitical risk has a significantly negative impact on business and consumer confidence in several advanced economies (de Wet, 2023). This is because consumers typically cut non-essential spending and businesses postpone investment decisions during turbulent times. This reduces firm-level investment, particularly for businesses with higher initial investment costs and greater market power (Wang et al, 2023). Higher geopolitical risks also reduce global trade and financial flows, causing greater volatility in capital flows in emerging markets (Kaya and Erden, 2023). Oil production cuts and higher energy prices The second way in which the Middle East conflict could affect the global economy is its impact on energy prices, both directly through production cuts and indirectly through greater uncertainties. In response to Israel’s actions against its neighbours, the Organization of the Petroleum Exporting Countries (OPEC) could reduce oil production to penalise countries supporting Israel. A similar action in the 1970s led to a significant jump in oil prices, which contributed to years of stagflation, with higher global inflation and recessions in major economies. Before Israel's attack on Lebanon at the end of September, oil prices had been declining due to falling demand, particularly from China. On the supply side, oil production had increased in Canada and the United States, countering the production cuts by OPEC, and Saudi Arabia was expected to increase oil production from December. But the situation quickly reversed following Israel’s attack on Lebanon. Oil prices jumped by nearly $10 per barrel within a week, before easing by around $5 per barrel. While the immediate oil price impact of Israel’s attack has mostly faded, the potential for higher oil (and other energy) prices still poses a risk to global inflation and economic activity (Liadze et al, 2022). To provide further context for the potential scale of this impact, we can show what would happen if oil and gas prices were to remain $10 higher for two years than the baseline levels projected in the Summer Global Economic Outlook from the National Institute of Economic and Social Research (NIESR), using NIESR’s Global Macroeconometric Model (NiGEM). The results demonstrate that the $10 rise in oil and gas prices increases inflation by around 0.7 percentage points in major economies in the first year (see Figure 2). The impact is higher in China, where the economy relies relatively more on oil imports for its strong manufacturing industries. The inflationary pressures persist for two years despite central banks’ efforts to curb inflation by increasing interest rates.   The effect of higher oil and gas prices on real GDP is shown in Figure 3. In the scenario described above, GDP would fall by 0.1-0.2% in major economies immediately. Partly due to higher interest rates, real GDP would continue to weaken for three years following the shock. After this, economic activity would start to return to base levels as oil and gas prices revert to their levels in the baseline forecast.   Increased shipping costs and supply chain disruptions A wider conflict in the Middle East could also affect the economy through higher shipping costs and supply chain disruptions. Houthi attacks on commercial ships in the Red Sea in late 2023 showed that such disruptions can have a huge impact on global trade through shipping, which comprises 80% of world trade volume. Following the rocket attacks by the Houthi rebels, some commercial shipping re-routed from the Red Sea to the Cape of Good Hope, leading to significant delays in travel times and increased freight costs. As a result, the Shanghai Containerized Freight Index – a measure of sea freight rates – rose by around 260% in the second quarter of 2024 with additional disruptions to supply chains. Our analysis shows that an increase of 10 percentage points in shipping cost inflation can lead to import prices rising by up to around 1% and consumer inflation increasing by around 0.5% in OECD countries. As Figure 4 shows, the impact of shipping costs on inflation shows its full effects over six quarters. This means that inflationary concerns could be with us for the next year and a half as a result of higher shipping costs that may emerge from any possible escalation of the Middle East conflict.   Wider economic implications and policy responses While rising geopolitical risk and increased oil and shipping costs can each individually exert upward pressure on inflation and may slow down economic activity in the global economy, the combined impacts are likely to be greater. Countries with stronger trade and financial ties to the Middle East and those that rely heavily on oil imports as an input for domestic production would be most affected. On the monetary policy front, central banks may have to take a more hawkish stance in response to rising inflationary pressures from the Middle East conflict. This could lead to higher interest rates, which would further dampen economic activity, particularly in an environment where there are already recessionary concerns in some major economies. Beyond its immediate economic implications, an escalation of the Middle East conflict could trigger large-scale displacement of people, which would increase economic and social pressures on neighbouring countries. Many countries may also have to increase their military spending in response to growing regional tensions. Given that public debt levels are already elevated in many countries due to successive shocks to the global economy over the past decade, any additional defence spending could come at the expense of public infrastructure investments that would otherwise boost productivity growth. Overall, the global economy is already underperforming as a result of the lagged effects of tight monetary policies, weaker global trade, a slowing Chinese economy and uncertainties surrounding the upcoming US election and possible changes to US trade policy. A potential escalation of conflict in the Middle East could exacerbate the situation by increasing uncertainties, harming efforts to bring down inflation and reducing global GDP growth. Over the medium and long term, it could further damage the global economy, with the possibility of refugee crises as well as increased defence spending, making the effects more complex and longer lasting. This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Diplomacy
market economy brics background meeting cooperation association russia summit international finance brazil

Southeast Asian countries enter Mr. Putin’s BRICSyard

by Zachary Abuza

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском Russian President Vladimir Putin last week hosted the BRICS summit, where Vietnam, Indonesia, Thailand, and Malaysia became official partner members – the first step toward full membership.  Putin had two main goals at the summit, where he tried to build up more international support for Russia against the backdrop of its invasion of Ukraine. First, he wanted to convey that Moscow is far from isolated on the world stage despite being targeted by United States-led sanctions, and that some of the largest economies don’t see the war in Ukraine as an impediment to closer ties with Russia.  Second, Putin was trying to build up consensus to create an alternative to the U.S. dollar-led trading order, which has made Russia and a host of other countries, including Iran, vulnerable to sanctions from the West. Putin made considerable progress on the first goal, but far less with the second one.  The four Southeast Asian states help explain why this is the case. Multipolar? Although Russia’s trampling of international law and use of military force to change borders sets a dangerous precedent for the countries of Southeast Asia, most states in the region see Russia as the path to a multipolar global order. And for Southeast Asian states that are always trapped in an increasingly zero-sum competition between Washington and Beijing, Moscow presents itself as a guardian of multipolarity. To them, it is a model for standing up to the West, or at least charting a more independent foreign policy.  For countries, whose foreign policy is largely transactional, pursuing ties with Russia increasingly makes sense.  Indonesia – arguably, the country in the region that is most protective of its sovereignty – has repeatedly voted against Russia at the United Nations, but barely spoken of Russia’s invasion.  Former President Joko “Jokowi” Widodo hosted foreign Minister Sergei Lavrov and met with Putin. But his Russia policy was extremely unprincipled and transactional. Russia has now supplanted Ukraine as Indonesia’s largest source for wheat imports. The country also is a major importer of oil from Russia, which has an internationally imposed price cap and sells below market rates. Prabowo Subianto, Indonesia’s new president, is set to continue this policy. Before his inauguration, he met with Putin and Prabowo’s foreign minister, Sugiono, made clear at the BRICS summit that Indonesia was seeking full membership in the grouping founded by Brazil, Russia, India and China. While Jokowi cared little about foreign policy, Prabowo seeks to assert Indonesia on the world stage with a much more active international policy and clout commensurate with its economic size. Russia is key to realizing this ambition. While Malaysia voted against Russia in two U.N. votes, its policy now is shaped by the conflict in Gaza, and Prime Minister Anwar Ibrahim’s seething anger towards the United States for its support of Israel.  Foreign corporations have recently pledged over U.S. $6 billion in investment to Malaysia’s semiconductor industry, one of the world’s largest.  Malaysia has angered Washington by repeatedly offering to sell semiconductors to sanctioned countries, including Russia and Iran. Anwar bristles at the unilateral imposition of U.S. sanctions on what he deems is a sovereign right to conduct foreign trade. Anwar views BRICS as not only a hedge against Western sanctions, but also as an alternative source of capital. Vietnam’s relations with Russia are long-standing and deep, and should be seen as part of its studiously neutral “bamboo diplomacy.” Vietnam voted with Russia in two U.N. votes, and abstained in a third. In July, Hanoi hosted Putin for a brief state visit.  Russia remains essential to Vietnamese security. Roughly 80% of its existing arsenal is Russian-made. While Vietnam seeks to diversify its supply chain, that will be difficult to do quickly.  The People’s Army leadership is close to Moscow. Its military is familiar with Russian equipment and produces many spare parts. Russia also allows licensed production of key weapon systems. In 2023, Moscow and Hanoi concluded an agreement to use proceeds from a Vietnamese investment in Siberian oil to fund the next generation of weapons. This alternative payment system was established to evade U.S. dollar transactions and thus Washington’s ability to impose sanctions. Thailand’s motivation in becoming a BRICS partner state has more to do with geopolitics than anything else.  A U.S. treaty ally, Thailand has been angered by Washington’s repeated imposition of sanctions as a result of military intervention in politics, including coups in 2006 and 2014.  China tried to fill that vacuum by maintaining close ties to the military leadership and increasing arms sales. Thailand feels caught between a rock and a hard place.  De-dollarization doubts Putin’s second goal, of de-dollarization, was far more divisive at the BRICS summit.  Luckily for the four Southeast Asian states, which depend so much on trade with the United States and which have no interest in creating a dollar alternative, they had India to hide behind.  Indian Foreign Minister S. Jaishankar firmly rejected Moscow’s de-dollarization agenda and made clear that India would continue to settle the majority of its trade in U.S. dollars. That was all the cover the Southeast Asian states needed. In sum, Jakarta, Putrajaya, Hanoi, and Bangkok are not seeking to upend the U.S.-led liberal international order through BRICS. They describe the grouping not as an “either-or” but an “and.”  A distant war For Southeast Asia, the war in Europe is far away. And the countries remain in deep denial about the international legal precedent being set or what Russian success in achieving its war aims would mean for global security. But Putin’s confidence presupposes the economic realities. While Russia has seemingly defied international sanctions and there’s still positive economic growth, expected to be 3.6% for 2024, this is now a war economy. Foreign investment has fled and is unlikely to return. More than 600,000 of Russia’s educated urban middle-class has emigrated in a massive brain drain.  Domestic production, meanwhile, is geared solely to support the war effort. Interest rates are now 21% to help counter the 13.4% inflation rate.  With an estimated 1,000 battlefield losses a day, and over 70,000 new hires in Russia’s primary defense contractor, Rostec, the labor market is tight. The IMF is predicting the Russian economy to finally feel the weight of prolonged sanctions and the war economy with GDP expected to fall to 1.3% and 1.2% in 2025 and 2026, respectively.  And even Moscow’s arms exports to Southeast Asia – one of its primary instruments of statecraft – are in doubt, as domestic demand surges. Between 2022-2024, Moscow’s arms exports fell by 60%, compared to the previous three-year period, according to the Stockholm International Peace Research Institute.  While Moscow sees the BRICS as the key to a multipolar world that would erode the dominant position of the United States, his moves to weaken the dollar’s grip is too confrontational for many of the new partner states. Putin’s own bravado may be undermined by Russia’s isolated wartime economy and inability to be the security partner of choice for many developing states. Copyright ©2015-2024, BenarNews. Used with the permission of BenarNews. 

Diplomacy
16th BRICS Summit family photograph (2024)

BRICS Summit 2024 — everything, everywhere, all at once?

by Priyal Singh

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском Ushering in a multipolar order requires a streamlined and coherent political agenda – not unfocused expansion.  The 16th BRICS Summit in Kazan, Russia, concluded last week with the usual grand declaration of the group’s commitments, concerns and aspirations.  Many media headlines, particularly in Western countries, focused on how the summit and BRICS generally, symbolised Moscow’s ability to circumvent the fallout of sanctions by turning to the global south. In this way, BRICS is indirectly viewed as a threat to Western efforts to isolate Russia, weaken its power projection capabilities, and end its invasion of Ukraine.  Western governments and analysts often struggle to frame BRICS’s evolution beyond a binary, zero-sum narrative in which the group is a key geopolitical challenge to the Western-dominated international order. This interpretation places the forces of democracy and liberal political values in one camp and authoritarian governments in another, with certain developing countries caught in the middle, trying to play one side off the other for their own benefit.  There is some merit to these kinds of headlines. Russia and China are primarily major status-quo powers. Both have been permanent United Nations Security Council (UNSC) members since its establishment. Moscow was the ‘other pole’ in the international order for most of the 20th century, a position Beijing is working towards. And the foreign policy goals of both place them in confrontation with the United States and its Western allies.  BRICS may be on a path towards unnecessary substantive bloat, and away from its core business.  So, are these two countries in a position to champion the global south’s cause, and why haven’t more representative bodies like the Non-Aligned Movement played a more prominent role?  The preoccupation with Russia and China detracts from BRICS’s broader, underlying geopolitical project – the need for global south countries to reform and shape the international order’s future direction on their own terms.  These include greater representation and agency in global policy- and decision-making bodies and facilitating greater freedom to trade, invest and borrow money outside the Western-dominated financial system. They also include a more just and equitable global power balance that reflects modern realities.  In pursuing these aims, BRICS countries have made steady progress on developing a shared strategic agenda for increased cooperation across various policy domains.  The Kazan summit’s 32-page outcomes declaration covers almost everything from reforming the UNSC and Bretton Woods institutions to climate change, biodiversity and conservation. It also covers challenges from global crises, conflicts and terrorism and a suite of economic development, health, education, science and cultural exchange-related issues.  A group of democracies, autocracies and theocracies speaking with one voice on human rights and democracy is absurd.  The group’s ballooning cooperation agenda may indicate progress. But it could also signify the limits of its diverse members’ ability to agree on ‘hard’ political and security matters central to the core business of reforming the international order.  The expansion of BRICS’ substantive agenda and its membership dilutes its primary purpose and reinforces the binary, zero-sum Western narrative its members constantly try to shed.  Tangible, albeit gradual, progress on establishing intra-BRICS institutions and processes such as the Interbank Cooperation Mechanism, the cross-border payment system and its independent reinsurance capacity suggest that BRICS’ clout and credibility are growing.  These initiatives could enable members to pursue their international economic objectives without the constraints and transactional costs associated with traditional financial bodies like the World Bank and International Monetary Fund. Ideally, this would improve their relative positions of global power and influence, and help deliver a more multipolar international order.  In contrast, deepening cooperation on big cat conservation, while important, doesn’t serve that purpose. Nor does facilitating youth exchanges on sports and healthy lifestyles or championing a BRICS alliance for folk dance. Including these kinds of initiatives in BRICS’ growing agenda detracts from its core objectives.  A streamlined agenda would divert attention from the contradictions and geopolitical manoeuvring of BRICS’ members.  More worryingly, this suggests that BRICS’ diverse constellation of member states is pursuing the path of least resistance – expanding their cooperation in every direction, hoping something eventually sticks.  Instead of doubling down on hard strategic questions about a shared conception of multipolarity, and the steps necessary to reform global governance and security institutions, BRICS seems to be heading for greater expansion and formalisation. And with that come the risks, challenges and institutional dependencies that have led to the stagnation and ineffectiveness plaguing more established international organisations in recent years.  Perhaps the group’s core members recognise that they have very different ideas of what constitutes multipolarity. Russia (and China to an extent) envisage much more than global institutional reforms, focusing instead on reimagining international norms and core principles.  These differences are also reflected in BRICS’ expanding membership. It seems Russian and Chinese enthusiasm has been curbed by other founding members, who prefer a ‘partner country’ model for future growth. This contrasts with the full membership offers to Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and UAE in 2023. (Argentina’s new political administration declined, and the Saudis have remained non-committal.)    Most worrying, however, is BRICS’ preoccupation with promoting democracy, human rights and fundamental freedoms. There is no doubt that these terms are increasingly politicised and rife with double standards – among developing nations with mixed political systems and traditionally liberal, Western democracies. However, for BRICS to meaningfully champion normative values, its members must at least attempt to commit to common political governance systems in their own countries.  Having a group of partner nations composed of progressive constitutional democracies and closed repressive autocracies and theocracies attempting to speak with one voice on promoting human rights, democracy and fundamental freedoms is absurd. It reeks of empty political rhetoric at best, and Orwellian double-speak at worst.  This again dilutes BRICS’ key messages, undermines its important core business, and detracts from the significant progress being made towards a common strategic agenda.  BRICS primary goal moving forward should be to trim the fat.  A streamlined annual working agenda would divert attention away from its individual member states' contradictions and geopolitical manoeuvring. With a focus on addressing the international system’s failures, institutional reform and greater representation for global south countries in policy- and decision-making bodies could be prioritised.  This seems unlikely though, if this year’s summit is anything to go by. By following the path of least resistance, BRICS may be setting itself on a course towards increasing and unnecessary substantive bloat, and away from its core business.  Only time will tell if certain members are willing to be more assertive and correct course before they are too far down a path impossible to pivot away from. 

Diplomacy
Donald Trump win in US president elections 2024. Washington DC, United Sates Of America - 2024 November 6

What Trump’s victory means for Ukraine, the Middle East, China and the rest of the world

by Stefan Wolff

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском Donald Trump’s return to the White House in January 2025, combined with a Republican-led US Senate, was widely feared among international allies and will be cheered by some of America’s foes. While the former put on a brave face, the latter are finding it hard to hide their glee.  On the war in Ukraine, Trump is likely to try to force Kyiv and Moscow into at least a ceasefire along the current front lines. This could possibly involve a permanent settlement that would acknowledge Russia’s territorial gains, including the annexation of Crimea in 2014 and the territories occupied since the full-scale invasion of Ukraine in February 2022.  It is also likely that Trump would accept demands by the Russian president, Vladimir Putin, to prevent a future Ukrainian Nato membership. Given Trump’s well-known animosity to Nato, this would also be an important pressure on Kyiv’s European allies. Trump could, once again, threaten to abandon the alliance in order to get Europeans to sign up to a deal with Putin over Ukraine.  When it comes to the Middle East, Trump has been a staunch supporter of Israel and Saudi Arabia in the past. He is likely to double down on this, including by taking an even tougher line on Iran. This aligns well with Israeli prime minister Benjamin Netanyahu’s current priorities.  Netanyahu seems determined to destroy Iran’s proxies Hamas, Hezbollah and the Houthis in Yemen and severely degrade Iranian capabilities. By dismissing his defence minister, Yoav Gallant, a critic of his conduct of the offensive in Gaza, Netanyahu has laid the ground for a continuation of the conflict there.  It also prepares for a widening of the offensive in Lebanon and a potentially devastating strike against Iran in response to any further Iranian attack on Israel.  Trump’s election will embolden Netanyahu to act. And this in turn would also strengthen Trump’s position towards Putin, who has come to depend on Iranian support for his war in Ukraine. Trump could offer to restrain Netanyahu in the future as a bargaining chip with Putin in his gamble to secure a deal on Ukraine.  Pivot to China  While Ukraine and the Middle East are two areas in which change looms, relations with China will most likely be characterised more by continuity than by change. With Chinese relations being perhaps the key strategic foreign policy challenge for the US, the Biden administration continued many of the policies Trump adopted in his first term – and Trump is likely to double down on them in a second term.  A Trump White House is likely to increase import tariffs, and he has talked a great deal about using them to target China. But Trump is also just as likely to be open to pragmatic, transactional deals with Chinese president Xi Jinping. Just like in relations with his European allies in Nato, a serious question mark hangs over Trump’s commitment to the defence of Taiwan and other treaty allies in Asia, including the Philippines, South Korea, and potentially Japan. Trump is at best lukewarm on US security guarantees.  But as his on-and-off relationship with North Korea in his first term demonstrated, Trump is, at times, willing to push the envelope dangerously close to war. This happened in 2017 in response to a North Korean test of intercontinental ballistic missiles.  The unpredictability of the regime in Pyongyang makes another close brush of this kind as likely as Trump’s unpredictability makes it conceivable that he would accept a nuclear-armed North Korea as part of a broader deal with Russia, which has developed increasingly close relations with Kim Jong-un’s regime.  Doing so would give Trump additional leverage over China, which has been worried over growing ties between Russia and North Korea.  Preparing for a Trump White House  Friends and foes alike are going to use the remaining months before Trump returns to the White House to try to improve their positions and get things done that would be more difficult to do once he is in office.  An expectation of a Trump push for an end to the wars in Ukraine and the Middle East is likely to lead to an intensification of the fighting there to create what the different parties think might be a more acceptable status quo for them. This does not bode well for the humanitarian crises already brewing in both regions.  Increasing tensions in and around the Korean peninsula are also conceivable. Pyongyang is likely to want to boost its credentials with yet more missile – and potentially nuclear – tests.  A ratcheting-up of the fighting in Europe and the Middle East and of tensions in Asia is also likely to strain relations between the US and its allies in all three regions. In Europe, the fear is that Trump may make deals with Russia over the head of its EU and Nato allies and threaten them with abandonment.  This would undermine the longevity of any Ukrainian (or broader European) deal with Moscow. The relatively dismal state of European defence capabilities and the diminishing credibility of the US nuclear umbrella would not but help to encourage Putin to push his imperial ambitions further once he has secured a deal with Trump.  In the Middle East, Netanyahu would be completely unrestrained. And yet while some Arab regimes might cheer Israel striking Iran and Iranian proxies, they will worry about backlash over the plight of Palestinians. Without resolving this perennial issue, stability in the region, let alone peace, will be all but impossible.  In Asia, the challenges are different. Here the problem is less US withdrawal and more an unpredictable and potentially unmanageable escalation. Under Trump, it is much more likely that the US and China will find it hard to escape the so-called Thucydides trap – the inevitability of war between a dominant but declining power and its rising challenger.  This then raises the question of whether US alliances in the region are safe in the long term or whether some of its partners, like Indonesia or India, will consider realigning themselves with China.  At best, all of this spells greater uncertainty and instability – not only after Trump’s inauguration but also in the months until then.  At worst, it will prove the undoing of Trump’s self-proclaimed infallibility. But by the time he and his team come to realise that geopolitics is a more complicated affair than real estate, they may have ushered in the very chaos that they have accused Biden and Harris of. 

Defense & Security
Natuna, Indonesia - June 15, 2024. Indonesian Coast Guard ships regularly patrol Natuna waters, as a form of the government's responsibility to protect Indonesian waters.

The 'Fatal Waters' of the Strait of Malacca: The Challenges of Combating Maritime Piracy in Southeast Asia

by Egor Sigauri-Gorsky

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском The problem of piracy has cast a shadow over the maritime areas of Southeast Asia for many centuries. The waters of the Malacca and Singapore Straits, which hold tremendous economic significance for international trade, are particularly susceptible to pirate attacks. In the 2000s, ASEAN countries launched a comprehensive regional campaign to institutionalize measures for collective action against maritime piracy, and these measures proved to be effective. However, excessive concerns about intrusions into their sovereignty have led the Association's member states to "dilute" their efforts, resulting in a lack of true unity. This situation could result not only in losses for international trade but also in the loss of lives of ship crews.  Introduction to the History of Maritime Piracy in Southeast Asia  Despite the long and dark history of the ugly and inhumane activities of the "hostis humani generis" [1], the romanticized image of pirates continues to captivate the public's imagination, thanks to numerous literary and cinematic works. In these portrayals, pirates appear as free-spirited men and women, living outside the reach of legal and state institutions, driven by daring adventures. However, it is not only European privateers, Somali groups, and the inhabitants of Morocco's "pirate" Republic of Salé who have left their grim mark on the history of maritime trade routes. For many centuries, pirates in Southeast Asia have attacked trading vessels passing through the Straits of Malacca. As early as the 13th century, the Chinese traveler Zhao Rukuo described how the powerful maritime kingdom of Srivijaya controlled regional waters [2], sending boats to attack ships that did not dock at its ports. Trading hubs in Malacca, Johor, and the Riau Archipelago flourished under the rule of Muslim sultanates, with the support of the Orang Laut community — “the sea people” — whose culture was inextricably linked to maritime activities [3]. It is no coincidence that in 1856, the Scotsman John Crawfurd, considered a leading British authority on Malay history and culture, noted that many Malay rulers viewed piracy as an "honest and regular source of their income" [4].  The Economic Significance of Maritime Waters in Southeast Asia  However, in the 21st century, maritime piracy remains one of the most pressing issues for Southeast Asian countries. According to data from the International Maritime Bureau’s Piracy Reporting Center, from 1992 to 2006, Southeast Asia was the most "pirate-infested" region in the world. The situation is further complicated by the fact that the waters of the Malacca and Singapore Straits, which are most susceptible to pirate attacks, are crucial for trade in the Asia-Pacific region. These straits also serve as "superhighways" of global shipping, with over 120,000 vessels passing through them annually. In 2000, 39% of Japan's foreign trade (equivalent to $260 billion) and 27% of China's foreign trade ($65.6 billion) were conducted through Southeast Asia's maritime routes [5]. Annually, the Malacca Strait facilitates trade valued at $3.5 trillion, accounting for two-thirds of China's maritime trade and 40% of Japan's maritime trade.  Despite significant improvements in the security of Southeast Asia's maritime routes over the past 20 years, thanks to the joint efforts of ASEAN countries and their partners, as well as the development of the shipping industry, the threat of maritime piracy remains a pressing issue. In this context, it is crucial to examine the existing initiatives aimed at combating maritime piracy in the region.  Overview of Projects, Agreements, and Initiatives  In 1999, at the ASEAN+3 Ministers' Conference under the concept of "Maintaining Peace in the World Ocean" Japan proposed an initiative to establish a permanent regional naval force based on national contingents. However, the project did not receive the necessary support. Five years later, in 2004, the Regional Cooperation Agreement on Combating Piracy and Armed Robbery against Ships in Asia (ReCAAP) was signed, leading to the establishment of an Information Sharing Center to facilitate cooperation between stakeholders and coastal states in combating maritime piracy in Southeast Asia. These events marked the beginning of a new era of multilateral cooperation.  The activities of the Information Sharing Center (ISC) have been crucial in building operational links between member countries of the Agreement and coordination centers, enabling information exchange, incident reporting, and rapid response to threats. A key role in maintaining security in the region is played by the Trilateral Cooperative Agreement between Indonesia, Malaysia, and the Philippines, known as "INDOMALPHI" signed in 2017. Under this agreement, maritime security is ensured through coordinated surface patrols, combined aerial maritime patrols, and the operation of an Intelligence Exchange Group. These efforts collectively enhance regional capabilities to respond to piracy and strengthen the overall security of Southeast Asia's maritime routes.  Coordination efforts among Southeast Asian countries also take place through naval cooperation. For instance, the Singapore Navy works closely with Malaysian and Indonesian regional naval forces to combat maritime piracy through the Information Fusion Centre (IFC). The navies of Brunei, Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam also actively participate in multilateral exercises conducted annually by the United States Navy. A key objective of these exercises is to strengthen regional measures against the threats of maritime terrorism and piracy in the Malacca and Singapore Straits, as well as in the South China Sea.  As a result of these efforts, the number of ship hijackings for ransom significantly decreased between 2007 and 2022. Representatives of Indonesia's Ministry of Defense noted that in the first six months of 2023, not a single incident of ship hijacking was recorded, whereas, in 2017, 99 cases of piracy and armed robbery at sea were reported in the patrol zone. Experts also highlight the potential benefits of Japan and India joining the "INDOMALPHI" initiative, which could further enhance regional security efforts against piracy.  Challenges to Regional Unity in Combating Maritime Piracy  Despite significant successes in consolidating the efforts of Southeast Asian countries in combating maritime piracy, there are still “gaps” in the “united front” of interested ASEAN countries that hinder individual and collective initiatives. Thus, Indonesia and Malaysia have not ratified the 2004 Agreement and are not de jure participants in the Information Exchange Centre, although they participate in some events under its auspices. The Centre itself receives information on cases of piracy and armed robbery at sea from the coordination centers of the participating countries, which inevitably entails a time lag that may prove critical in the event of a threat to a ship and its crew. It is noted that an appropriate clarification of the mechanism of its work would be the obligation of ships to send information directly to the Centre, which would immediately transmit it to the relevant operational units of the participating countries responsible for deploying patrol vessels on site.  The Downside of the "ASEAN Way"  The Russian researchers note that while ASEAN is discussing the possibility of creating a unified navy to combat piracy, the approaches of the "ten" countries to the problem differ [7]. It is the absence of full-scale consolidated institutions that significantly undermines the successes already achieved and may provoke an escalation of the problem after the "lull" of 2000-2022. ASEAN's traditional rigid orientation towards the rejection of any supranational institutions and concern about maintaining national sovereignty may play a "dirty joke" on the Association's states, since the existence of multiple regional initiatives duplicating each other's functions and goals, as well as the fact that the Information Exchange Center does not have a real operational status, slow down progress. Finally, it should be borne in mind that at stake in this case is not only the stability of international economic turnover along the maritime trade routes of Southeast Asia, but also the lives and safety of ship crews, fishermen and sailors, whose professions are already associated with risk.  References  1. "Enemies of the Human Race" - author's note.  2. See in particular: Berezin E.O. History of Thailand M. 1973. 320 pages. p. 35.   3. There are conflicting views regarding the true role of the Orang Laut in maritime piracy. While some researchers portray their culture as inherently linked to piracy in the conventional sense, others argue that the "sea people" were driven to piracy due to the actions of British colonial authorities who controlled the port of Singapore. See on this: Barnard T.P. Celates, Rayat-Laut, Pirates: The Orang Laut and Their Decline in History // Journal of the Malaysian Branch of the Royal Asiatic Society. Vol. 80. No. 2. 2007. P. 33-49.  4. Amirell S.E. Pirates of Empire. Colonisation and Maritime Violence in Southeast Asia. Cambridge University Press. 2019. 266 pp. P. 37.  5. Frécon E. The Resurgence of Sea Piracy in Southeast Asia. Institut de recherche sur l’Asie du Sud-Est contemporaine. 2008. 131 pp. P. 72-73.  6. Paramonov O.G. "Maritime Piracy in Southeast Asia: A Regional Perspective." // International Analytics. No. 1-2 (27-28), 2019, pp. 74-81, p. 77.  7. Paramonov O.G. "Maritime Piracy in Southeast Asia: A Regional Perspective," p. 78. 

Energy & Economics
This is the 30th anniversary logo of ASEAN's formal relations with India.

India's evolving trade strategy with ASEAN

by Soumya Bhowmick , Tanisha Paul

한국어로 읽기 Leer en español In Deutsch lesen Gap اقرأ بالعربية Lire en français Читать на русском The AIFTA and CECA have increased India-ASEAN trade, but recent talks aim to address trade imbalances and adjust tariffs for improved Indian export access. India's Act East Policy, initiated in the early 1990s (previously Look East Policy), is a cornerstone of India's foreign policy to strengthen economic, strategic, and cultural ties with the Asia-Pacific region, particularly Southeast Asia. Free Trade Agreements (FTAs) play a central role in this strategy. India's approach to trade policies, particularly in FTAs with the Association of Southeast Asian Nations (ASEAN), reflects a complex balancing act between protecting domestic industries and fostering international trade partnerships. The India-ASEAN Free Trade Area (AIFTA), established in 2009, aimed to enhance economic cooperation by offering tariff concessions on goods traded between India and ASEAN countries. However, recent talks have focused on revising tariff structures to address disparities and improve trade flows, highlighting India's commitment to deepening economic engagement with ASEAN for mutual benefits and regional integration. To be sure, ASEAN remains a crucial trading partner for India, accounting for 11 percent of its global trade, with bilateral trade reaching US$ 122.67 billion during 2023-24. The India-ASEAN Comprehensive Economic Cooperation Agreement (CECA) comprises three key agreements covering Goods, Services, and Investment. India’s trade with ASEAN experienced astounding growth after signing the ASEAN-India Trade in Goods Agreement (AITIGA). However, the trade disproportionately benefits the ASEAN region. Between FY 2009 and FY 2023, imports from ASEAN to India grew by 234.4 percent while exports from India rose only by 130.4 percent, expanding India’s trade deficit from US$ 7.5 billion annually when the agreement was enacted in 2011 to approximately US$ 44 billion in 2023.    The potential adjustment of tariffs is influenced by the need to protect burgeoning sectors within India's economy, aligning with the government's “Make in India” initiative to transform India into a global manufacturing hub. For instance, raising tariffs on mobile phone parts and automobile components could incentivise domestic production and reduce import dependency. In the goods trade category, India eliminated import duties on approximately 74 percent of tariff lines and reduced duties on an additional 14 percent of tariff lines—highlighting one consolidated offer to ASEAN. At the same time, each ASEAN member made separate offers to India. This asymmetry in negotiation power also hinders India’s flexibility in protecting vulnerable domestic industries from competitive ASEAN imports.  ASEAN economies are inherently export-oriented with flourishing manufacturing bases. In contrast, India’s economy is significantly service- and agriculture-oriented, and it has not fully capitalised on the FTA, resulting in higher penetration of ASEAN countries into the Indian market. Indian exports have struggled to gain similar traction in ASEAN countries. Moreover, the inverted duty structure on certain items, like ferroalloys, aluminium, copper pipes and tubes, textile staple fibres, and several chemical preparations, puts Indian industries at a disadvantage.  To boost local manufacturing, India has implemented specific measures such as Production-Linked Incentive (PLI) schemes, higher import tariffs, and import monitoring, but several trade agreements negotiated earlier are seen as impediments. Domestic firms in India, particularly in the electronics and automotive sectors, have pressured the government to raise import tariffs to protect local industries, rooted in the desire to safeguard domestic manufacturers from cheaper imports and promote self-reliance and technological advancements. The implications of such tariff hikes extend beyond immediate economic protection. By fostering a robust industrial base, India can create jobs, stimulate economic growth, and enhance technological innovation. However, it is crucial to implement these measures in a way that does not significantly disrupt trade relations in the region. India-ASEAN trade talks  The 5th meeting of the AITIGA Joint Committee at the ASEAN Secretariat in Jakarta, Indonesia, in July 2024 marked a significant step forward in strengthening economic cooperation between India and ASEAN where all eight sub-committees focused on market access, rules of origin, standards, sanitary measures, and trade facilitation. India will host the next round of negotiations to review the AITIGA in November 2024 to address the pending concerns involving the reciprocity of trade benefits between India and ASEAN. One of the primary concerns is the trade imbalance between India and its FTA partners. To address this imbalance, India seeks greater market access for its goods, particularly in the automotive and agricultural sectors. For instance, India aims to enhance exports of automobiles and agricultural products to ASEAN countries, aligning with its strategic economic goals despite challenges. Reducing non-tariff barriers is another critical issue. Non-tariff barriers, such as stringent customs procedures and regulatory hurdles, impede smooth trade flows and increase business costs. Simplifying these procedures and ensuring compliance with international standards can facilitate more accessible trade between India and its FTA partners. For example, streamlining customs procedures for agricultural exports can help Indian farmers access new markets in ASEAN countries. The ASEAN bloc has already expressed concerns about India’s Customs (Administration of Rules of Origin under Trade Agreements) Rules, 2020 (CAROTAR 2020), which they believe hinder their exports. Indian negotiators also push for tariff cuts in various sectors, including chemicals, metals, textiles, and gems, while addressing non-tariff barriers imposed by ASEAN, such as strict food certification requirements. The outcome of these negotiations will be pivotal in reshaping India-ASEAN trade dynamics. Revising the sensitive and exclusion lists to ensure fair trade practices while protecting vulnerable domestic industries will also be a crucial point of negotiation. This revision can help balance the interests of domestic manufacturers with the need to adhere to international trade commitments. Enhancing the transparency and predictability of trade practices, including establishing consistent and transparent trade policies, will be essential to foster a more robust trade relationship. Finally, by engaging with ASEAN through comprehensive trade agreements like AIFTA and CECA, India aims to boost economic cooperation and solidify its geopolitical influence in the region. India’s efforts to balance protectionism with regional integration reflect its broader economic strategy. For example, the “Atmanirbhar Bharat” (Self-Reliant India) initiative emphasises self-reliance and domestic manufacturing while seeking to integrate India into the global economy by enhancing its trade relationships. This strategy can ensure that India remains competitive in the global economy.