By Nader Mousavizadeh
The opinions expressed are his own.
Ten years after the attacks of September 11th, the brief moment of global solidarity that followed when we were “all Americans,” in the words of Le Monde, seems as improbable as it is distant. Barring a global catastrophe, the world is unlikely to unite again as it did on that day – and not just because of the conduct and course of the wars of 9/11 in Afghanistan and Iraq. A deeper – and more radical – shift is at work in the politics of the global economy. A fragmentation of power, capital and ideas is creating a new map of the world – with lasting implications for investors and policymakers alike.
The evidence is everywhere. Europe beginning to roll back key aspects of the free market even as it manages yet another bail-out of Greece; the failure of the Copenhagen climate change negotiations; a Doha trade round dead in all but name; the emergence of new global governance structures, such as G-20; the flows of macro-finance investments between emerging markets combining state and business interests; China’s “going out” strategy upending traditional vectors of global capital and influence; an Arab Awakening as much defined by its diversity as its aspiration for accountability and legitimate government; the resurgence of nationalist, populist movements across rich and poor parts of the world; a proliferation of hybrid economic and political systems defying old categories of left and right, liberal and authoritarian.
Conventional thinking holds that all this is a threat to an otherwise well-ordered global order – or that it reflects a zero-sum shift from West to East, U.S. to China, democracies to dictatorships. For large parts of the world, of course, the existing global order seemed less well-ordered than designed to perpetuate – by any means necessary – dated power structures of the mid-20th century. Equally, to see this merely as reflecting an all-embracing power shift to the East (as observers both Eastern and Western do) ignores the fact that pivotal powers such as Turkey, Brazil, Indonesia and Nigeria are charting distinct paths aimed above all at economic independence and national power – beyond ideological labels.
Instead, what we’re seeing is an emerging world of sovereign states vertically integrating national interests across the public and private sectors – and then going out strategically to compete for resources, growth and job creation. Having previously understood global interdependence as a reason for horizontal integration across markets and regions, states as diverse as Finland, Saudi Arabia, Japan and Mexico are now pursuing distinct, often bilateral, strategies for economic and political security. This is the new dynamic of global competition – one with implications as profound as they can seem contradictory.
From South-east Asia to West Africa, commodity states are leveraging their economies to the Chinese demand driver without wishing to replace Washington’s dominance with Beijing’s. Across the Middle East, citizens are deploying technology and new-found communications tools to demand consent in how they’re governed without losing their ability to see their values and traditions reflected in the fabric of their societies. In Latin America, state-owned corporations are working hand-in-hand with governments to pursue inclusive growth of a kind that holds promise beyond what was achieved by structural adjustment programs imposed by Western-dominated multilateral institutions.