The New Global Edifice: Gathering in the ‘Rest’
A series of international organizations—a network of networks—created by Russia and China form the pillars upon which an alternative to the Western-dominated world order are being built. There is already an institutional split between the West and the rest evidencing the pre-schism bifurcation among great powers: the G7 and G20. Whereas in the former is dominated by seven Western powers and thus was able to expel Russia, transforming the G8 into the G7, this still has never been attempted in the G20 by the G7 and its allies opposed to Russia and China, since the G20 includes not just Russia but other ‘restern’ (i.e., rest) powerhouses like China, India, Indonesia, and others. Thus, it is around Russia, China, and in part great power India plus Iran that the resistance to continued Western hegemony has developed. To be sure, some ‘restern-inclined’ powers, not to mention weaker Tird World states, are struggling to maintain a neutral position between the West and the Sino-Russian-led rest, but the stress put on the international system by Western hubris, financial-economic hegemony, and demands for democracy compliance are reaching a breaking point. It is precisely in the Third World, former Western colonies where the new ‘restern-oriented’ international structures are organizing an alternative pole to the Western one under a Sino-Russian aegis, creating a bipolar, perhaps multipolar world. It cannot be excluded that those great powers, such as India, that attempting to straddle the West-rest schism will strike out and form a new non-aligned movement, rather than make the risky commitment to one camo or the other. Below is an overview of the Sino-Russian-led IOs that constitute a restern network of networks being constructed to counter the West.
Russia’s Eurasian Economic Union (EEU) is a key Russian brick in the new wall splitting the world apart. It includes Russia, Belarus, Armenia, Kazakhstan, and Kyrgyzstan and three observers—Moldova, Mongolia, and Cuba. Tajikistan is currently reviewing whether it will seek membership. In May 2015 Vietnam became the first country to sign a free trade zone (FTZ) agreement with the EEU. At the EEU summit in July 2015 Russian presidential aide for foreign policy Yuri Ushakov announced that India and the EEU had agreed to create a working group for exploring an India-EEU FTZ. A recent Kazakhstani report indicates that more than 30 countries—including Zimbabwe, Jordan, Mongolia and Albania—have applied to the Eurasian Economic Commission for a EEU FTZ relationship (http://en.tengrinews.kz/politics_sub/Over-30-countries-interested-in-signing-free-trade-agreement-261289/). In 2019, both Israeal and Iran were reported to be close to signing an EEU FTZ agreement (https://www.timesofisrael.com/israel-and-iran-both-set-to-join-russia-led-free-trade-zone/#:~:text=Incidentally%2C%20Iran%20is%20also%20in%20advanced%20talks%20about,with%20Tehran%2C%20or%20other%20states%20signing%20similar%20agreements). On 1 November 2022, Teheran and Moscow announced agreement had been reached and Iran would be signing a FTZ agreement with the EEU shortly (https://sputniknews.com/20221101/russia-iran-agree-to-sign-free-trade-agreement-with-eurasian-economic-union-1102915212.html).
The Collective Security Treaty Organization (CSTO) remains Russia’s key Eurasian military alliance, but it may soon be superceeded and even integrated gradually with the Shanghai Cooperation Organization (see below). Its members—Russia, Armenia, Belarus, Kazakhstan, Kyrgyzstan, and Tajikistan—played a pivotal role in putting down the Kazakhstani revolt earlier this year and helping new Kazakhstani President Kassym-Jomart Tokaev to restore order and consolidate his rule against the Nazarbaev clan. The CSTO’s image was recently strengthened by the pivotal assistance it provided in helping Kazakhstan’s government put down the January revolt. CSTO/EEU member Belarus is moving closer to Moscow under the Russia-Belarus Union, with the war in Ukraine raging next door and isolation from the West intensified because of Minsk’s support for Moscow’s military effort, offering its territory as a jumping off point for the original invasion and the insertion of new Russian troops into the conflict.
To be sure, the West and NATO are probing to weaken Russia’s close relations with EEU and CSTO states. The U.S. is using Russia’s military preoccupation with Ukraine to counter in the South Caucasus, using Aremeni-Azerbaijani tensions surrounding the ‘frozen’ Nagorno-Karabakh conflict. U.S. House Speaker Nancy Pelosi’s trip to Yerevan in the wake of the Azerbaijani September attack on Armenia is an attempt to wean Armenia, present chair of the CSTO that so effectively intervened in the Kazakhstan revolt earlier this year. Outbreaks of fighting around Artsakh and Moscow’s preoccupation with Ukraine and attendant challenges internationally over the last year opened opportunities there for the West. It remains to be discovered whether or not Washington and/or Brussels (NATO) offered incentives to Azerbaijan to renew the war against Armenia and thus expose Russia’s perhaps limited readiness to intervene in full diplomatic and political-military force. In Central Asia, the West is pursuing greater economic ties and the right to set up a military base in order to challenge Russian hegemony there—a hegemony supplemented by increasing Chinese involvement. In addition, the West is trying to convince Kazakhstan to use an alternative oil export route to its current use of Russian pipelines. Thus, the post-Soviet states remain a contested cleft between the two worlds.
The Shanghai Cooperation Organization (SCO), originally an economic cooperation bloc, can supplement, bolster, and ultimately incorprate the EEU and CSTO and EEU in economic and security matters, becoming a potential platform for forming a large economic and military bloc for Eurasia—that part of the rest that is likely to be most dependent on and/or loyal to Beijing and Moscow. In addition to SCO’s five original members (Russia, China, Kazakhstan, Kyrgyzstan and Tajikistan), it has added four new full members (Uzbekistan, India, Pakistan, and Iran) since 2015 and has three observer members (Belarus, Afghanistan, and Mongolia). Iran, having completed its application, acceded to full membership at the annual SCO summit held in Samarkand in September. SCO also is considering applications of five other countries: Bangladesh, Iraq, Israel, Syria, and Vietnam. In addition, SCO has six ‘dialogue partners’—Armenia, Azerbaijan, Cambodia, Egypt, Nepal, Qatar, Sri Lanka and, most notably, NATO member Turkey and eight more states seek dialogue status: Myanmar, Maldives, and four Arab states, Bahrain, Kuwait, OAE and, most notably, Saudi Arabia. These various SCO members constitute nearly two-thirds of the world’s population and more than three-quarters of the world’s non-Western population.
In the present circumstances one can expect the other observers and dialogue partners to perhaps seek and receive full membership status. Most likely, observer Belarus’s application will be accepted at next year’s summit, and dialogue partners Armenia and even Azerbaijan will seek an upgrade in participation. But more important than any other development, perhaps, was the post-summit announcement by Turkish President Recep Tayyip Erdogan that Turkey will seek full memberdship (www.reuters.com/world/middle-east/turkeys-erdogan-targets-joining-shanghai-cooperation-organisation-media-2022-09-17/). The diplomatic demarche of enticing NATO member Turkey into SCO cannot be overstated. Turkey’s dealings with Russia and growing democracy deficit may prove too much for NATO under the stress of circumstances surrounding Ukraine and the Black Sea. With membership in SCO, it becomes more likely that one day we may see Ankara move towards the rest more decisively, underscoring Western decline and aggravating anger in NATO and the West towards SCO and the rest.
Thus, under SCO much of the Middle East—including, most notably, Israel—in addition to a host of Eurasian, East Asian, and South Asian states are forming a Greater Eurasian international structure for economic, political, and military cooperation. Moreover, the inclusion of NATO member Turkey, Western ally Israel, and a host of other states reducing their reliance on relations with Washington and the West (Saudi Arabia and Egypt, for example) speaks not just to a consolidation in Eurasia writ large but a potential weaning of non-Western allies from the West. SCO’s breakthroughs with Teheran and Ankara in Samarkand cannot be overstated, especially in the context of the summit declarations by Putin and Chinese Premier Xi that the organization has become a bulwark against U.S. hubris and Western hegemony in the emerging new international system. Hours after SCO’s Samarkand summit, Russian and Chinese navies conducted joint patrols and military exercises in the Pacific Ocean. But SCO is not yet a primarily military-oriented structure, though it has institutionalized military cooperation at the defense minister level through regular meetings. To the contrary, it was originally intended by Moscow and Beijing as a tool to integrate Eurasia economically, and for now focus on transport integration and the creation of a SCO development bank trump military efforts conducted officially under SCO auspices. At the same time, SCO members are key participants in China’s central foreign economic policy initiative, and that fact could cause a shift by SCO to the security and military spheres.
One Belt One Road
The One Belt, One Road (OBOR) economic and transport infrastructure integration project for Greater Eurasia is Beijing’s grand scheme to integrate Greater Eurasia under China’s leadership and some degree of dependency on China. OBOR has dispatched Chinese funding and companies to build roads, railways, fiber-optic cables, and other hard infrastructure across the Greater Eurasia landmass and beyond. All EEU, SCO and CSTO members are participants in OBOR, not least of all Russia. Indeed, OBOR’s transport, energy, and other infrastructure projects for integrating Eurasia and bringing its network to Europe involves some 30 Eurasian countries directly and has attracted the attention of more than a hundred more. In May 1917, President Xi Jinping’s Belt and Road Forum in Beijing hosted leaders from 28 countries and delegates from 110 countries (www.csis.org/analysis/president-xi-jinpings-belt-and-road-forum). The OBOR now extends from China to Rotterdam in the West and Nairobi in the south, from to the Arctic in the north and India in the south (https://matthewehret.substack.com/p/the-russia-china-polar-silk-road and https://african.business/2019/04/economy/african-leaders-sign-billions-in-deals-at-chinas-belt-and-road-summit/).
Missing conspicuously from OBOR is the West, which has shown limited interest. Rather than integrating with the Greater Eurasian continent’s great powers, for example, by joining with Russia in building a tunnel between Alaska and Kamchatka in order to link North America with Eurasia and thus Europe by land, the U.S. and Europe largely have ignored China’s grand project for Eurasian integration and international economic influence. Perhaps with a view to an Alaska-Kamchatka tunnel project and further infrastructure cooperation through North America linked to OBOR, both the USA and Canada have been invited to participate in OBOR on several occasions since its 2013 inauguration, but no positive response has been forthcoming (https://matthewehret.substack.com/p/the-russia-china-polar-silk-road). Since the EU’s 2018 adoption of its “Connecting Europe and Asia” strategy, the focus in Europe has been to seek an alternative approach to China’s Belt and Road Initiative and Eurasian integration (www.eeas.europa.eu/sites/default/files/joint_communication_-_connecting_europe_and_asia_-_building_blocks_for_an_eu_strategy_2018-09-19.pdf). Thus, by ignoring the OBOR project, the U.S. and EU have acted to ensure greater isolation of the West from Greater Eurasia and potentially the rest of the rest than otherwise might be, giving greater impetus to the global schism. For example, in the energy sphere, given U.S.-driven Russian sanctions, the North Streams’ destruction, and deteriorating Sino-Western relations, the U.S. actions are rendering Europe more West-introverted and America-dependent, as long-term contracting with suppliers of U.S. LNG and other forms of energy take over and are likely to persist well into the future (www.politico.eu/article/joe-biden-us-gas-eu-where/).
At the same time, America’s growing obstinance in maintaining, indeed maximizing Western hegemony has driven Eurasian powers’ aspirations for greater integration as an economic and strategic defense approach. Despite U.S. President Joseph Biden’s extensive and illegal business ties with Beijing through his son Hunter Biden, his administration has done nothing to overcome divisions with Beijing and Russia and continues to compete aggressively with them for influence. For this there is little to show other than a furthering of global bifurcation and polarization and an intensification of Eurasia’s internally focused integrative development, the cornerstones of which is China’s OBOR and Russian transport and energy power. When Biden took office, instead of turning the page and attempting to lean forward in an attempt to smooth out differences with Beijing (not to speak of those with Moscow), his administration’s Secretary of State Anthony Blinken placed lecturing China on democracy and human rights at the center of the first talks with Chinese Foreign Minister Wang Yi. Ironically enough, those March 2021 talks took place where from Washington might have begun to integrate with Eurasian projects: Anchorage, Alaska. As soon as the exasperated Yi returned to Beijing, in flew Russian Foreign Minister Sergei Lavrov to Beijing. After their talks, Yi immediately set out for Teheran and concluded 25-year $400 billion deal on technology transfer, infrastructure development projects, energy sales, and other agreements. Shortly thereafter Russia’s GazProm signed a $40 billion agreement with the National Iranian Oil Company that includes technological assistance for Iran’s development of two gas fields and six oil fields as part of transport infrastructure integration in a north-south corridor to intersect with OBOR and integrate Russia, Iran and India through a network of roads, rail systems, and sea linkages and an Iran-to-India gas pipeline.
Russia, its closest allies in the EEU (CSTO and SCO), and all Eurasia are intimately involved in China’s OBOR. Moscow is integrating Eurasia with oil and gas pipelines, transport corridors, and other elements. Russia’s OBOR involvement includes the formation of a key southern logistical corridor connecting Russia’s Astrakhan to India through Iran among numerous other east-west infrastructure, energy, and transportation projects. Moreover, Russia’s other key OBOR-related initiative, the International North-South Transport Corridor (INTSC), running from Murmansk in the far north, near-Arctic to India, will intersect with the primarily east-west OBOR projects. China’s western “middle corridor” of the east-west OBOR extends several rail and road corridors connecting to the INSTC (https://matthewehret.substack.com/p/the-russia-china-polar-silk-road). Some 50 trains transit through Russia to Europe from China weekly, and more are being added annually. The INTSC includes 12 participating countries, and in July the corridor saw its first transit completed. The rail train started out near Moscow and moved through Russia, Kazakhstan (CSTO and SCO member also), Turkmenistan. Azerbaijan (SCO member) is part of two other routes tied to the INTSC running through SCO members Iran and India (https://sea-news.az/2022/07/16/russia-iran-north-south-transport-corridor-launched/). It should be noted that in the first half of 2022 no China OBOR investments were directed to Russia, apparently because Beijing preferred to avoid secondary sanctions tied to the war in Ukraine (https://www.epochtimes.ru/biznes/novosti-mirovyh-rynkov/kitaj-prekratil-investitsii-v-rossiyu-cherez-proekt-odin-poyas-odin-put-158099/?utm_source=yxnews&utm_medium=desktop&utm_referrer=https%3A%2F%2Fdzen.ru%2Fnews%2Fsearch%3Ftext%3D). This is one case of blowback on Russian and Eurasian integration produced by Putin’s invasion of Ukraine in February.
De-dollarization and de-Westernization regarding the reserve currency trade payments are also part of cooperation with OBOR. The EEU Chairman of Russia’s Eurasia Commission, Sergei Glazyev, a prime mover of this EEU-China-OBOR integration noted, as did his Chinese counterpart, their commitment to this goal in a Sino-Russian meeting on this integration in 2020. Glazyev called for the EEU and China to fully transition to trade settlements between the countries in national (that is, non-dollar) currencies. The ongoing process by then had reached the point where 72.4 percent of such settlements in EEU states’ mutual trade were paid in rubles, increasing by 4.4 percent between 2015 and 2019 (www.eurasiancommission.org/en/nae/news/Pages/17-09-2020-1.aspx). The EEU is near signing a long-awaited economic treaty with China along Glazev’s proposals (https://matthewehret.substack.com/p/the-russia-china-polar-silk-road). The use of non-Western currencies and payment systems will likely soon be extended mostly to the yuan and ruble across a broader Euraian space.
Since 2018, Russia and China have added an Arctic or Polar Silk Road (PSR) to OBOR. This “northern extension of the Maritime Silk Road” will cut 10 days from transportation time to Europe (https://matthewehret.substack.com/p/the-russia-china-polar-silk-road). The Russian goal is to use the PSR in order to assist in the development of Siberia, which in 2021 was targeted for a massive city-building project proposed by Defense Minister Sergei Shoigu. Towards this end, in addition to ports, plans to establish a China-Russian Arctic Research Center as part of the PSR were agreed upon (https://tass.com/press-releases/1053930). The center is researching the development of capabilities for building on permafrost, creating ice resistant platforms, and more durable icebreakers, new technologies needed for enhanced ports, and transportation in the deep cold. China’s interest in this work is tied both to the PSR as well as its 30% stake in Siberia’s Yamal LNG Project and the ‘Power of Siberia’ 3000 mile Russia-China gas pipeline, which since its inception in 2019 is the primary supplier of China’s oil and natural gas (https://matthewehret.substack.com/p/the-russia-china-polar-silk-road).
OBOR is internationalizing beyond Greater Eurasia. In 2019, for example, five African countries’ leaders—the presidents of Djibouti, Egypt, Kenya and Mozambique, and the Prime Minister of Ethiopia—attended the second OBOR summit and signed numerous transport, energy, technology, and other infrastructure deals with OBOR participants, China most notably. Such projects extend dependence on China across the globe in part by creating large debts for some participants of the Belt and Road project. Djibouti’s strategic location at the mouth of the Red Sea makes it a potential conduit for OBOR into Africa. OBOR’s Maritime Silk Road can link with Eastern and Southeastern Africa (such as Ethiopia, Kenya, Tanzania, Mozambique, Madagascar, South Africa), North Africa (Egypt, Morocco, and Algeria), and inland to the Democratic Republic of Congo, Zambia, and Zimbabwe (https://african.business/2019/04/economy/african-leaders-sign-billions-in-deals-at-chinas-belt-and-road-summit/). This makes OBOR a network of networks (EEU, SCO, ASEAN) that can interlink with the other major Sino-Russian global networking project: BRICS.
BRICS is an instrument for institutionalizing bipolarity or multipolarity and rallying the rest against the West on a global scale in numerous possible spheres, excluding the security-military sphere, which would require a mega-regional Eurasian bloc likely to be based on the Shanghai Cooperation Organization (SCO). Putin, who first proposed BRIC, has had many strategic political and economic goals in developing BRIC/S based on cooperation with the world’s key regional powers in Asia (China and India), South America (Brazil), and later Africa (South Africa) on each continent, excluding Europe and North America—i.e., the West.
Russia’s first and foremost strategic purpose is for BRICS to be a mechanism for Russia to maximize and project globally Russian economic and political influence and power. For China, as for Russia, the association is a leading instrument for expanding networking and influence to all the world’s continents and civilizations. For one, the association creates opportunities for Russia and China to develop economic and political partnerships with global reach, strengthening Russia’s global presence through “non-institutionalized” global “management” and “network diplomacy.” These goals drove Moscow’s initiative for BRICS, expanding BRIC to Africa by way of South Africa’s inclusion, with BRIC becoming BRICS. Second, by including only non-Western powers from across the globe’s continents, BRICS facilitates Russia’s and China’s geostrategic goals of creating a multipolar world. This geostrategic goal of pluralizing the international system’ structure through BRICS is mentioned routinely in both Russia’s BRICS Concept and Foreign Policy Concept and is now an urgent Russian foreign and security policy priority. Undermining the international system’s monopolarity under ‘American hegemony,’ is a third strategic goal of BRICS pursued by hindering efforts by the U.S. and its Western allies to delegitimize Russian domestic and foreign policy. Although the five BRICS countries have little in common, differing widely in their cultures, politics, economics, and demographics, Russia’s BRICS partners have one important common trait—they are non-Western or non-European and are former colonies of Western powers. This part of the BRICS strategy also becomes prioritized in the new world schism and Moscow’s need along with Beijing to organize the rest autonomously from the West. Fourth, Moscow and Beijing seek to strengthen stability by using BRICS to strengthen the principles of state sovereignty, territorial integrity, and non-interference in the internal affairs of states in response to what it interprets as Western efforts in support of separatism and regime change, as exemplified by efforts in Yugoslavia, Serbia, Ukraine, Libya, Syria. Significantly, Serbia, Syria, and Libya have refused to join the West’s -NATO Ukraine sanctions regime against Russia. Of course, China has sovereignty concerns from Western support for Tibet, the beleaguered Uighurs of Xingjiang, and breakaway Taiwan.
The global schism’s intensification after February 2022 gave impetus to previously tentative talk of expanding BRICS. On May 19th, three months after the Russian escalation of the civil war in Ukraine, Beijing called for BRICS expansion—a policy long supported by Moscow—at a meeting of the BRICS foreign ministers. “China proposes to start the BRICS expansion process, explore the criteria and procedures for the expansion, and gradually form a consensus,” Wang Yi, China’s state councillor and foreign minister stated (www.reuters.com/world/china/china-says-it-wants-expand-brics-bloc-emerging-economies-2022-05-19/). A week later, Russian Foreign Minister Sergei Lavrov hinted that traditional U.S. ally Saudi Arabia as well as Argentina are interested in joining BRICS, noting they are “interested in BRICS’s activities” (https://en.trend.az/world/other/3600995.html). A May 20th “BRICS Plus” discussion included representatives of Argentina, Kazakhstan, Egypt, United Arab Emirates, Saudi Arabia, Indonesia, Nigeria, Senegal, and Thailand in addition to BRICS’ five full members. At BRICS’ July summit, Iran announced it was applying for membership, Argentina and Saudi Arabia announced they plan to join the group, and Egypt, Indonesia, and NATO member Turkey announced they were pursuing membership. At the same time, the president of the BRICS International Forum, Purnima Anand, announced that Turkey, Egypt, and Saudi Arabia might “very soon” join the club of major emerging economies (https://noqreport.com/2022/07/17/brics-is-expanding-and-every-american-should-be-concerned/). Indonesia and Nigeria might also soon begin pursuing membership (https://thediplomat.com/2022/07/great-power-conflict-fuels-brics-expansion-push/). However, it was reported that several members opposed Egypt’s and Indonesia’s entry. Decisions on expansion were said by one BRICS official to be on the agenda for BRICS’ 2023 summit. (Strana.ua, https://strana.news/news/399494-saudovskaja-aravija-ehipet-i-turtsija-planirujut-vstupit-v-briks.html, citing Russia’s Izvestiya).
One of Putin’s top economic advisors, former Minister of Economy and Trade Sergei Glaziev pointed years ago to the rising monetary-financial tactical component in BRICS for countering the West. In a December 2013 issue of Russia in Global Affairs, as the Maidan crisis in Kiev mounted, Glaziev called for BRICS to abandon the dollar and euro as reserve currencies in order to halt Euro-Atlantic integration’s “clear imperial ambitions”: “This integration continues and will continue as long as other world players agree to finance it, accepting the dollar and the euro as world reserve currencies. Should BRICS countries give them up, the whole Euro-Atlantic expansion, based on military and political coercion, will stop in a flash.” The primacy of concerns about monetary and financial risk led Moscow to push at the 2013 G20 summit for a BRICS agreement on creating a $100 billion currency stabilization fund. Russia’s idea for the Currency Reserve Fund’s capital contributions included: China—$41 billion; Brazil, India and Russia each—$18 billion; and South Africa—$5 billion. Such a pool can become a part of the de-dollarization process and move to an alternative world currency. BRICS has formed its own Development Bank to manage the currency fund and many BRICS partner states are interested in joining it.
The recent victory of the socialist communist candidate Lulu da Silva in the November 2022 Brazilian presidential election could add impetus to de-dollarization within and outside BRICS. Lulu declared in May 2022 that he intended to create a Latin American currency, the sur (south), in order to subvert the dollar as the world’s reserve currency. He also declared his intention step up cooperation in BRICS, which Brazil joined during his earlier term as president. In 2020, da Silva published a call “For a Multipolar World” urging “the creation of a multipolar world, free from unilateral hegemony and from sterile bipolar confrontation” that “would permit a true re-founding of the multilateral order, based on principles of real multilateralism, in which international cooperation can truly flourish” (https://cpnn-world.org/new/?p=27278).
Bilateral relations between BRICS members are moving in the direction of the association on numerous issues. For example, Russian and Indian business elites and lobbyists are beginng to discuss the need to shift to conducting trade and business in the countries’ national currencies rather than the dollar (https://riafan.ru/23725072-ispol_zovanie_natsvalyut_pozvolit_ukrepit_torgovlyu_mezhdu_rossiei_i_indiei?utm_source=yxnews&utm_medium=desktop&utm_referrer=https%3A%2F%2Fdzen.ru%2Fnews%2Fsearch%3Ftext%3D).
Like the EEU (free trade zones), SCO and OBOR, BRICS is also expanding its influence beyond member-states. At the 2022 Samarkand SCO summit, China proposed using local currencies in trade settlements and financing through the BRICS and Asian-Pacific multilateral associations, such as APEC. Chinese Peoples Bank (CPB) chairman Yi Gang announced that Beijing would facilitate with other Asian states the use of such currencies for trade and investment. Already three months prior, the CPB initiated Yuan Liquidity Mechanism by which the central banks of Indonesia, Malaysia, Hong Kong, and Chile would be afforded access to high liquidity funds for use in periods of high volatility (https://impakter.com/brics-expansion-five-new-members-in-2023/ and https://inosmi.ru/20220906/kitay-255943984.html?in=t).
Putin’s BRICS initiative has proven to be a prescient strategy. No BRICS member has joined the West’s sanctions against Moscow, and all have adopted a neutral position on the Russo-NATO Ukrainian war, resisting Western especially U.S. pressure to ‘isolate Russia.’
If the East can through BRICS and/or other mechanisms win over ‘swing state’ India or several other major players, consolidating a global majority, then the West could soon come to play second fiddle in global economics and eventually become a set of second-rate military powers. The West’s economic domination is already becoming a thing of the past. Moreover, what share of the global economy the Western economies account for has been overestimated because of an overvaluation of the virtual information and services economy (https://threadreaderapp.com/thread/1549554660184231936.html). For decades Western capitols has been overemphasizing virtual economic power, equating it with or preferring it over real tangible production. In the West it is common to hear that the size of Russia’s economy is equal to that of Italy or the state of Texas, even though Russia is one of the global leaders in oil, natural gas, nuclear power, wheat, steel, coal, gold, diamond production and export. While Russia has struggled and only partially succeeded in developing beyond its Soviet industrial base and production, the West, especially the U.S., has thoughtlessly deindustrialized. Russian gas sanctions and the destruction of the Nord Stream 1 and 2 gas pipelines ensure that deindustrialization in Europe will accelerate.
It is not just Russian economic power that is underestimated. The entire rest of the rest is underestimated in the percent of the global economy it comprises, leaving far overstated the degree of Western economic hegemony and the extent of the West-rest economic gap and time cushion the West can enjoy before it finds itself at second-tier status. Much of western GDP figures count consumption such as sales of retail goods (made in China or Mexico and imported to USA or Europe) as ‘production.’ Then the methodological error of overvaluing the virtual Western economy kicks in. Western economies’ structural transformation or virtualization into information and service economies has left the U.S., UK, Germany, France, and Switzerland as the world’s leaders in the percentage of GDP taken up by services—70 percent or more! They are followed by many EU states as well as Australia, Japan, Brazil, South Africa, Israel, and Jordan at 60-70 percent (https://threadreaderapp.com/thread/1549554660184231936.html).
But when it comes to the ‘real’ economy of raw materials and finished goods production, China, not the U.S., is the leader, followed by the U.S., then Russia, India, Brazil, Canada, and Australia, according to one recently compiled index. China is leaving the rest in the distance in almost every category of primary goods and industrial manufacturing, producing 7-8 times more coal and iron than the U.S., 12 times more steel, and twice as many cars. Overall, BRICS overshadows the U.S., Europe and Australia, and China’s index exceeds the most powerful European states (Germany and France) by at least ten times. A similar picture can be seen in food production (https://threadreaderapp.com/thread/1549554660184231936.html). For a more expansive historical comparison, in 1900 the U.S. and Europe controlled 90 per cent of all oil, natural gas and coal supplies. By mid-century this figure had dropped to 75 per cent, and today it limps at 35 per cent.
The picture in high technology bodes no better for Western supremacy:
“China’s dominance in the strategic rare-earth minerals used in batteries, computer screens, high-tech weapons, electric vehicles, and other advanced technologies gives China leverage and the potential to strand Western economies. According to China-focused consulting firm Horizon Advisory, China is ‘not concerned with economic return,’ instead seeing its control of advanced technology industries ‘as a path to win without fighting.’ According to a December 2021 report from the Harvard Kennedy School, ‘beyond becoming a manufacturing powerhouse, China has become a serious competitor in the foundational technologies of the 21st century: artificial intelligence (AI), 5G, quantum information science (QIS), semiconductors, biotechnology, and green energy. In some races, it has already become No. 1. In others, on current trajectories, it will overtake the U.S. within the next decade.’” Meanwhile, U.S. sanctions on Chinese companies are decoupling the two economies, most pivotally by restricting Chinese companies’ access to U.S. chip-related technologies and products with potential military and public monitoring applications (https://americanmind.org/salvo/decoupling-from-china-quickly/). The number of Chinese companies placed on the U.S. Entity List which excluded firms from participating in certain strategic sectors in the U.S. has increased from 130 in 2018 to 532 at present (https://carnegieendowment.org/files/Bateman_US-China_Decoupling_final.pdf, p. 19). This could push China to invade Taiwan and cutoff the U.S. economy from crucial microchips.
In addition to the West-rest economic, financial, and military-political bifurcation processes outlined above, there is an informational-cultural schism—a new iron curtain descending not just ‘over Europe’ but over the world. Russian and Chinese media are being banned in the West, as Western media are being banned in Russia and have been for a long time in China. Indeed, within the West itself there is an informational iron curtain, with conservatives banned from some social media, and conservatives creating their own alternatives, paralleling the global rest in relation to the ‘free world.’ Social web and cancel culture practices are likely to expand across the globe, not least of all through media like Facebook and Twitter. The more democratic states continue to authoritarianize to protect themselves from authoritarianism, then ironically enough the more authoritarian they themselves will become. This will only aggravate sociopolitical tensions in Western states, and the more recalcitrant rest (Russia, China, Iran) will seek to capitalize on those internal divisions, leading to further authoritarianization on both sides of the world schism and therefore greater West-rest informational and cultural division, as local populations will have a weak informational foundation upon which to question, no less challenge polarizing policies undertaken by governments. In the West, cancel culture, which has produced bans on Tchaikovskii, Dostoevskii, and other elements of Russian culture—among much else—is likely to be expanded to Chinese culture in future. Beyond the polarizing LGBT and religious issues, Russia also is beginning to isolate itself from Western culture, with China—a country with less cultural connections with the West—at some point likely to follow to a more expansive cultural isolation than is extant at present. Economic, informational, and overall cultural bifurcation is bound to exacerbate political relations and intensify military preparations for war in our world split apart.
Part 3 to follow.