The world has entered a new global paradigm, writes Eurasia Group president and political risk strategist Ian Bremmer, defined by the lack of coherent global leadership to guide international policies and driven by the perception that participating in the economy is playing a zero-sum game.
Bremmer synopsizes this world view—what he calls “G-Zero”—in his new book, Every Nation For Itself: Winners and Losers In A G-Zero World, available in stores today.
With debt problems threatening its fiscal health, the United States must gradually pull back on the scale of global goods it provides. Meanwhile, Europe is struggling with its own financial problems, and Japan continues to stumble under the weight of nearly 30 years of sluggish growth.
However, Bremmer argues that emerging powers—in particular, China—have made clear that they are not yet willing or able to fill the void, and they will restrain themselves to local hegemony.
Without global leadership, the world will not have the power to enact the most efficient measures to address climate change, free change, food and water shortages, and more.
As the misalignment of interests and power gradually renders international organisations like the G20, the IMF, and the World Bank defunct, new winners and losers will emerge from the ashes of the old global system.
- With a middle class numbering over 100 million people, Brazil is the consumer superpower of South America.
- Not only does its economy account for 40 per cent of regional GDP, it is energy-independent and well diversified.
- The government is friendly to foreign investment, but tied closely to both China and the United States, not to mention other emerging market countries.
- Turkey's geographic and ideological position as the connection between the Middle East, the former Soviet Union, and Europe will provide it with increasing importance as the West continues to rely on Arabian oil reserves.
- The country also serves as a model for other Middle Eastern states, a unique blend of modernity, democracy, and Muslim roots.
- Turkey remains the Middle Eastern country most friendly to Israel, regardless of tensions.
- Swift economic growth in recent years has gone largely unnoticed. From 2000 to 2010, continental real GDP grew at an average rate of 4.7 per cent per year.
- African governments are turning both to traditional global players like the IMF, World Bank, and Western governments and to emerging market powers like China for investment.
- Emerging and developed market countries will come to compete for African consumers and investment opportunities.
- Indonesia enjoys a wealth of natural resources, yet its economy is diverse and its workforce well-educated and youthful.
- It has the world's fourth-largest population, an increasing percentage of which is becoming 'middle-class.' That will make it attractive to countries wishing to benefit from its consumer base.
- Indonesia will play ties to China, the United States, Japan, and Singapore to its advantage.
- With real GDP growing at an average of 7.5 per cent over the past 20 years and poverty falling from 58 per cent to 14.5 per cent over nearly the same period, Vietnam provides an attractive consumer base.
- It enjoys aid from a variety of different powers: 'its development aid from Japan, its arms from Russia, its machinery (and tourists) from China, and its biggest export market from the United States.'
- Singapore sees one-third of the world's maritime traffic pass through its Strait of Malacca every day.
- The country aims to balance Eastern culture and Western business practices in order to make itself an indispensable hub for finance in Asia.
- Mongolia prizes its relationships with the United States and other Asian countries in order to balance neighbouring powers Russia and China.
- The country's massive, still untapped coal, copper, gold, and oil provide attractive inducements for foreign investment.
- Exports of oil, metals, and grains have made Kazakhstan one of the world's fastest-growing economies.
- Though the country has joined trade partnerships with both China and Russia, its largest customer remains the European Union.
- Canada's growth in the wake of the financial crisis demonstrate the country's increasing independence from economic conditions in the United States.
- Almost 40 per cent of Canada's imports come from and 25 per cent of exports go to countries outside the U.S.
- Strong ties with Asia and the near-completion of a free-trade agreement with the EU provide promising signs that such independence will continue.
'States that openly flout international rules with cover from other governments' will flourish in an environment where international powers are unable to enact universal rules and where existing agreements go unenforced.
- China continues to fear chaos in North Korea, and this unhappy Chinese patronage allows North Korea the cover to violate nuclear agreements and threaten its neighbours.
- The fact that it has already flouted international policies in nuclear testing 'has given North Korea a kind of international 'get out of jail free card,'' because world leaders acknowledge that they cannot enforce many of the restrictions they impose upon it.
- The withdrawal of U.S. influence in the Middle East leaves open the opportunity for Iran to step in and fill the void of investment and ideology.
- A wealth of Iranian oil and gas resources means that foreign countries--particularly states in the European Union--will have to cooperate with Iran whether they like it or not.
- Though the authoritarian Burmese government is guilty of horrendous human rights violations, China, India, and others rely on Burma's natural gas and oil resources.
- neighbouring states' investments in infrastructure mean that they'll likely continue to cover for Burma on the international stage for years to come.
Exposed states 'dependent on U.S. strength and Washington's willingness to use it to protect its allies' will suffer from retrenchment in American foreign policy.
- Tensions between Japan/Taiwan and China are unlikely to fade, as their ideological and cultural behaviour fester.
- Further, re-ignition of these tensions is met with domestic popular support, providing incentives for age-old feuds to continue.
- Trepidation about participation in Middle Eastern affairs has made the U.S. and Europe less likely to come to the aid of Israel.
- Arab Spring has compromised the old balance of power in the Middle East, leaving Israel vulnerable to physical or ideological attacks from new enemies.
- While the U.S. will not abandon Israel, it will likely push its ally to develop new security strategies and stomach unpopular compromises.
Shadow states 'remain frozen in the shadow of a single power,' regardless of desires for more diversified investments and trade partners.
Mexico is highly dependent upon the U.S.: 'Mexico's largest sources of foreign currency come from oil sales, tourism, and remittances from Mexicans working abroad. In all three cases the vast majority comes from the United States, and there is no evidence that it will change anytime soon.'
- Popular support is growing for closer ties with Europe, however a high percentage of ethnic Russian voters means politicians still have to pander to the Russian community.
- Dependence upon cheap Russian energy for economic growth translates into a resigned cooperation in Ukraine with the whims of its larger neighbour.
- With a retrenchment in U.S. policy, distraction in Europe, and the unwillingness of China to fill the void of international policeman, 'Russia faces less outside pressure than at any moment since the outbreak of World War I.'
- Russia has some free reign to re-establish its sphere of influence.
- The country faces growing commercial threats from China and emerging markets like Kazakhstan and Turkey.
- High oil prices could reinforce an inefficient political elite that discourages economic diversification.
- 'The country's primary problem is that it still depends too heavily for growth and the creation of new jobs on the spending habits of American, European, and Japanese consumers, a vulnerability never more obvious than in the immediate aftermath of the financial crisis...'
- Political cronyism and historical support for state-owned enterprises could compromise development of domestic demand.
- The rise of China creates new and unpredictable economic and political tensions, and Asia is already a hotbed of concerns in that area.
- Domestic discontent threatens to rear its ugly head at any moment.
- 'In a G-Zero world, China is the major power least likely to develop along a predictable path.'