The dismal decade (Part 6: Seven forces shaping 2030 #1- #3)

The dismal decade (Part 6: Seven forces shaping 2030 #1- #3)

Phuah Eng Chye (29 June 2024)

In my final articles for the blog, I have taken up the challenge of sketching out transitional scenarios to 2030. In this context, this decade stands out as a landmark for the global reset. The decade opened with the Covid pandemic, followed by huge fiscal and monetary stimulus, the invasion of Ukraine, the deepening of decoupling and recently the Gaza hostilities. And we are not even at the half-way point to 2030.

This decade, governments placed themselves at the forefront of leading tumultuous change – sometimes from managing unanticipated events and at other times from causing massive change through their policies. By most accounts, governments are doing a bad job – neither managing geoeconomic challenges nor addressing societal problems satisfactorily. To be fair, the challenges may have been beyond anyone’s ability to manage. The pandemic has turned endemic, inflation shifted from transitory to permanent while societies became deeply polarised. The Great Powers are escalating conflict rather than seeking peace and cooperation. They increasingly question each other’s legitimacy, intently probe vulnerabilities, flagrantly cross red-lines and are accelerating preparations for war. The list of black swan events have mushroomed – commodity price shocks, political and global crises, and military and trade escalations. These could lead to catastrophes such as a global depression or a nuclear war. Xi Jinping sums it up: “The world today is undergoing major changes unseen in a century. These changes, not limited to a particular moment, event, country or region, represent the profound and sweeping changes of our times. As changes of the times combine with the once-in-a-century pandemic, the world finds itself in a new period of turbulence and transformation”.

The world is changing drastically and there are few clues as to what the 2030 landscape will look like. I cover the seven forces I think will be influential in shaping the future – namely (1) Great power conflict, (2) Military warfare, (3) Asymmetric warfare and reset of global rules, (4) Global imbalances and anorexic economies, (5) Monetary disorder and US policy transition, (6) The crisis of governments, and (7) Information society challenges.

Force #1 – Great power conflict

Wake-up calls – Pandemic and Russian invasion of Ukraine

The pandemic was a big wake-up call and highlighted how even health and science issues was not immune from politicisation and polarisation. Politicians, governments, health authorities and the medical industry – both at home and internationally – lost credibility in their failure to control the pandemic. There is still no authoritative view on the origins of the disease, the  effectiveness and side effects of vaccines and on pandemic controls (such as masking and lockdowns). If Covid-19 didn’t permutate to a less-life-threatening variant, governments and economies would have been in a pickle.

The pandemic also served as an awakening of sorts. Dan Ciuriak points out “the pandemic-induced economic crisis served to merge, amplify and accelerate changes driven by a slew of technological, political and natural shocks”. This includes the populist reaction to the distributional excesses of globalization 2.0; global supply chain restructuring and decoupling driven by US moves to counter China’s technological rise, and amplified by ad hoc economic nationalism measures to address supply chain risks in critical areas highlighted by the pandemic; the digital transformation which disrupted established business models and generated a plethora of new economic, societal and security concerns and regulatory challenges; and the urgent need to address the twin crises of climate change and species extinction, a need highlighted by apocalyptic images emerging from extreme weather events and growing concerns about imminent tipping points that would drive irreversible changes in global environmental systems. “The solution space to which the economy is being pushed will look different from the one disrupted by the pandemic. What we produce, and how we produce it, will change and, by extension, so will the ways in which we share this production internationally and exchange it through the trading system, as will, indeed, our approach to how the system is governed”. Another “feature of the pandemic has been to underscore the reality that, in a pinch, a country may find it has no friends, as all countries scramble to look after number one first”. “The world has since moved en masse to protect such vulnerable assets…while inward FDI restrictions can make sense for knowledge assets with powerful local externalities that warrant public sector intervention, they make little sense for traditional industrial assets. This reality will likely reassert itself as we move into the post-pandemic period”. “In short, the centripetal and centrifugal forces in play ensure that the trading system will not revert to peak globalization, nor move toward autarky. This raises questions about the rules framework that will emerge to manage and facilitate trade in the new normal to come – will it be a tweak on the current framework, or will it reflect more fundamental reforms to address the changed economic conditions and terms of trade in the digital era?”

Kate Mackenzie and Tim Sahay note as vaccine (energy and other) shortages emerged, “developing countries were also reminded of their position in the international financial and geopolitical hierarchies…those with more power and resources bid up prices and developing countries lost out in the process. In the case of vaccines, millions of lives were lost”. “Developing countries were reminded that the existing world order is rigged against them. Global inequality rose sharply. Their shortages of money and inability to borrow cheaply put them at the back of the queue. The grim fact that the West not only denied poor countries IP for technology to make their own mRNA vaccines in the hour of distress, but hoarded vaccines past their sell-by date, revealed the system’s bankruptcy”.

The geopolitical lessons on supply chain security were reinforced by the Russian invasion of Ukraine. The Western reaction was swift – comprehensive sanctions against Russia. Yet, these sanctions proved ineffectual largely because China and other Global South countries filled in the economic vacuum left by Western ostracization. This heightened Western concerns on the strategic implications of China’s rapid trade, technological and military advances; its domination of global supply chains and its growing geopolitical influence. China’s rise has triggered anxiety that the West will be unable to maintain their domination over the rules-based order and to consider whether and how they should confront or accommodate China’s requirements.

China’s rise and Thucydides’ Trap

The dynamics accompanying China’s rise are different from those of Japan in the 1980s. China is a near-peer rival of the US[1] in many ways that Japan never was. The ideological and strategic objectives are irreconcilable – the most obvious being Taiwan – and they are in confrontation across almost most fronts. As Graham Allison puts it succinctly in his book Destined for war: Can America and China escape Thucydides’ Trap, “unless China is willing to scale back its ambitions or Washington can accept becoming number two in the Pacific, a trade conflict, cyberattack, or accident at sea could soon escalate into all-out war”.

What are the right questions to ask on China’s rise? In my view, the common error is to keep falling back to history. China changes at a rapid speed and as its capabilities (to take on the West) grow, its objectives and strategies will change accordingly. Today, China is in a very different position from when it chose to “hide your strength, bide your time”[2]. I feel China now thinks it is time to project power to protect its interests.  

Lance Gore has interesting arguments on the West’s reaction to China’s rise. “The shock of the rise of China to the global order centred on Western civilisation is obvious to all. Whether the mainstream countries within the present order accept the changes brought about by the rise of China depends, to a large extent, on the level China has achieved in various aspects. Historically, countries such as Germany, the Soviet Union and Japan had failed to be accepted despite their great strength – they were defeated by a coalition of mainstream countries. One important reason that the US managed to supersede Britain as the global hegemon was the former’s achievements within the same civilisation. As a major power representing a different civilisation, China cannot possibly realise its own rise within the parameters of Western civilisation, for even if it becomes an outstanding exemplar of that civilisation, it could only be relegated to an auxiliary role like Japan. Besides, the problems of Western civilisation become more pronounced with each passing day. The peaceful rise depends more on whether or not China is able to surpass the highest achievements of contemporary civilisation. It has to contribute to elevating humankind to a higher level of civilisation in order to be recognised and accepted as a leader. But the reality is that China’s popularity in polls of the developed world keeps on sinking to new lows. When China is perceived as an existential threat and fails to be approved and accepted by mainstream countries, its rise encounters endless difficulties and obstacles. Moreover, when these countries join forces, they may be able to derail China’s rise. Having the support of third world countries is not going to be very helpful for China here, because the level China seeks to rise above is that of the developed countries”.

I argue there are shortcomings in these perspectives. First, China probably anticipated its rise will not be accepted by the West and that Western countries will likely act in concert to supress China as they once did during its Century of humiliation[3]. Second, China does not see itself replacing the US. China perceives itself as a peer rival to the US with the ability and a role to spearhead the establishment of an alternative global ecosystem. Third, there is a perception gap that China needs acceptance because China remains dependent on the West for markets, technology and finance. Based on this, the West can combine to blockade or contain China by deployment of superior force to eventually force China to accept its terms. I don’t think this view is realistic because I believe China is in a position to move forward independently of the West. The question is whether the West would allow China to build a separate sphere as this would mean accepting a diminution of its global influence. The US, in opposing China’s actions, signals it will not accept China as a geopolitical equal. With neither side giving way, confrontation appears inevitable.  

The West increasingly thinks China’s rise should be opposed as it is an “unreliable” partner[4]. Matt Pottinger and Mike Gallagher argue the US “shouldn’t manage the competition with China; it should win it. Beijing is pursuing a raft of global initiatives designed to disintegrate the West and usher in an antidemocratic order…These actions show that China isn’t aiming for a stalemate. Neither should America”. “What would winning look like? China’s communist rulers would give up trying to prevail in a hot or cold conflict with the United States and its friends. And the Chinese people – from ruling elites to everyday citizens – would find inspiration to explore new models of development and governance that don’t rely on repression at home and compulsive hostility abroad. In addition to having greater clarity about its end goal, the United States needs to accept that achieving it will require greater friction in U.S.-Chinese relations. Washington will need to adopt rhetoric and policies that may feel uncomfortably confrontational but in fact are necessary to reestablish boundaries that Beijing and its acolytes are violating. That means imposing costs on Chinese leader Xi Jinping for his policy of fostering global chaos. It means speaking with candor about the ways China is hurting U.S. interests. It means rapidly increasing U.S. defense capabilities to achieve unmistakable qualitative advantages over Beijing. It means severing China’s access to Western technology and frustrating Xi’s efforts to convert his country’s wealth into military power. And it means pursuing intensive diplomacy with Beijing only from a position of American strength, as perceived by both Washington and Beijing”.

Matt Pottinger and Mike Gallagher advocate policies that “rearms the U.S. military, reduces China’s economic leverage, and recruits a broader coalition to confront China. But the United States could keep the Chinese military contained and still lose the new cold war if China held the West hostage economically. Beijing is bent on weaponizing its stranglehold over global supply chains and its dominance of critical emerging technologies. To reduce Chinese leverage and ensure that the United States, not China, develops the key technologies of the future, Washington needs to reset the terms of the bilateral economic relationship. It should start by repealing China’s permanent normal trade relations status, which provides China access to U.S. markets on generous terms, and moving China to a new tariff column that features gradually increasing rates on products critical to U.S. national security and economic competitiveness”.

It is also not an auspicious sign that Chinese diplomats are beginning to respond with disdain; giving the impression it has given up on prospects of an amicable détente with the West. Foreign Minister Wang Yi’s[5] widely publicised rebuke was: “If the US says one thing and does another, where is its credibility as a major country? If it gets jittery whenever it hears the word China, where is its confidence as a major country? If it only wants itself to prosper but denies other countries’ legitimate development, where is international fairness? If it persistently monopolizes the high end of value chains and keeps China at the low end, where is fairness in competition?”

Conor Gallagher notes “Chinese President Xi Jinping said…Beijing is not going to sit back and watch is the US keeps pushing. If the preferred method of warfare from the US is a proxy war coupled with an economic war, the contest is an attritional one to see whose system cracks first”. China has already been preparing for confrontation. China “has already broken the US chip blockade…China is heavily investing in munitions and acquiring high-end weapons systems and equipment five to six times faster than the United States. China is also the world’s largest shipbuilder and has a shipbuilding capacity that is roughly 230 times larger than the United States”. China is securing its energy supply with Russia and Central Asia “and rapidly expanding land supply chains through the region”. “China’s trade with the Central Asian states (Kazakhstan, Tajikistan, Uzbekistan, Turkmenistan, and Kyrgyzstan) hit $89.4 billion in 2023, a 27 percent increase over 2022. That puts the central Asian states collectively in 10th place on the list of China’s top trading partners and has them poised to overtake the Netherlands and Germany, with whom trade is rapidly declining”.

Peter Lee thinks “the US is determined to degrade the PRC’s military, economic, and international security and domestic social and political stability in all available dimensions. Concessions are tactical; attacks are strategic”. “The worst case being some crisis, genuine or manufactured, that leads to complete breakdown of relations between the United States and China and US moves to sever China from the world economic system and collapse PRC rule, using the anti-Cuba/Iraq/North Korea/Russia trade and financial sanctions regimes as a template. That means trade shrinks. Investment dries up. The economy staggers. Political repression increases. The social contract between the CCP and the Chinese public evaporates”. He believes “this increasingly plausible worst-case scenario is driving a lot of PRC decision-making…So if the US goes all-out on anti-PRC sanctions it will find that a certain chunk of nations will be willing and able to side with China, just as they have spurned US blandishments to join the Ukraine united front against Russia…I think PRC’s domestic policy – its current restraint on economic stimulus as it tries instead to keep the economic wheels turning through other incentives – may also reflect this worst case outlook. Perhaps instead of opening the money spigot to rescue Country Garden and other big private developers, the CCP is sticking with a tight-money policy to force a restructuring of the property industry to reduce its leverage, make it less dependent on financial engineering, and recast home ownership as an affordable public good and less of an opportunity for investment and speculation reliant on offshore dollars. So the PRC is trying to war-harden the country without cratering the economy, and postpone indefinitely the day when America feels it has the advantage and opportunity to escalate the China confrontation to total economic warfare”.

Peter Lee points out “there’s a whole generation of people – important people – who grew up and thrived in an environment of US-China engagement. For them, decoupling from the United States – and the damage it has inflicted on their interests and aspirations – is painful. The losers include: entrepreneurs who dreamt of that New York IPO, that US investment deal, that American bank account. Academics who hoped to be treated in the West as valued interlocutors and colleagues and not representatives of a pariah state. Intellectuals who wanted to be accepted and respected as a bridge between Western liberal ideals and PRC socialist practice. They are the people whose opinions and complaints are eagerly sought out and broadcast by the Western press…Their attitudes are divided between rage and resignation as they anticipate their final exit”. “Meanwhile the CCP is recruiting and cultivating new elites centered on the BRICS international regime, a less glamorous, less rewarding, but possibly more resilient order seeking its future in Russia, South Asia, the Middle East, South America, and Africa. They’ll be talking to CGTN and RT instead of sharing their discontents with the New York Times, the Wall Street Journal, and Bloomberg. The idea that elite and popular opinion in China could shift aspirations away from Disney, MacDonald’s, and McDonnell Douglas to telenovelas, couscous, and Sukhoi jets is perhaps inconceivable to Americans, but the CCP is trying to make it happen. As they say, in the old world there is a new world struggling to be born. Will the CCP succeed? The product it’s pitching to its citizens and to the world – that’s multilateralism via economic engagement – is fundamentally more attractive to a lot of countries than the deficit driven global War to Save Democracy that the US is peddling. Given money, perseverance, luck, and time the PRC might be able to thread the needle…My opinion is, if the CCP is succeeding, in other words if it shows significant progress in establishing a robust parallel international order that can shield it from US economic aggression, the US will start a hot war to see if it can truly f*ck China up. Because the only US response to failure is escalation”.

As 2030 draws nearer, it would seem US and China are in danger of falling into Thucydides’ Trap.  The US, together with its allies, are redoubling efforts to contain China and Russia across all fronts. China seem to be hardening its responses lately. This increases the intensity of economic confrontations which is setting up the possibility of direct military confrontations. Yet, it should be noted that Thucydides’ Trap tends to over-simplify global geopolitics into a bipolar conflict and ends up overlooking the complex forces shaping 2030 scenarios.

Competing paradigms and messy multipolarity

The global reset may be less about China’s rise and more about how Western power is declining. Christopher S. Chivvis and Beatrix Geaghan‑Breiner note “the structure of international politics is changing in ways that are not fully appreciated in Washington. The United States has paid a great deal of attention to the rise of China in the last decade but much less to emerging powers whose rise will also shape the operating environment for American statecraft. No single emerging power will have an impact tantamount to China’s, but they will have a significant impact collectively due to their geopolitical weight and diplomatic aspirations. America has limited ability to influence the trajectory of these emerging powers…Argentina, Brazil, India, Indonesia, Mexico, Nigeria, Saudi Arabia, South Africa, Thailand, and Türkiye. They have taken stances that contrast or directly clash with U.S. positions on China and on Russia over the past few years…Almost none would line up with the United States in a confrontation with China. Instead, they are likely to pursue highly self-interested foreign policies. Washington should expect that they will increasingly challenge some of its policies, sustain relationships with its adversaries, and press their own agendas on the global stage…The emerging powers’ statecrafts are shaped in large part by their drive for economic security. But their geographies, different preferences for world order, domestic politics, and defense relationships also play a role”.

Christopher S. Chivvis and Beatrix Geaghan‑Breiner argue “it will be a mistake for the United States to frame its relations with these emerging powers primarily as part of a competition for influence with China and Russia, however tempting it may be to do so. These powers are not swing states that will tilt decisively toward either side in a global great power competition. Most will resist any efforts to bring them into a U.S.-led camp as in the Cold War. Trying to make them do so would also risk strategic overreach by embroiling the United States too deeply in the emerging powers’ domestic politics or by expending its resources in pursuit of building ties that never materialize. A better approach for the United States would be to focus on negotiating interest-based deals with emerging powers while cordoning off areas of disagreement. These might include tailored market access and investment agreements, agreements on technology manufacturing, energy transition initiatives, efforts to combat deforestation, efforts to build public health infrastructure, and infrastructure investments. It would be wasteful of the United States to offer these countries security guarantees, but in some cases providing security assistance can serve its interests. Washington should accept that most of these countries will maintain close diplomatic, economic, and sometimes security relationships with China and probably Russia. Over the longer term, it will serve U.S. interests to strengthen the sovereignty of emerging powers when possible and cost-effective to do so. This will provide a bulwark against the undue expansion of China’s power and influence and help ensure that, even if they do not side with the United States, they are not drawn closely into the orbit of its major geopolitical competitors. Strengthening emerging powers’ sovereignty will also help boost their development as constructive powers with a stake in sustaining a peaceful world order conducive to global economic growth”.

Multipolarity is eroding the pillars of the existing world order. Robert D. Blackwill and Thomas Wright notes Henry Kissinger, in his 2014 book World Order, writes that world order rests “on two components: a set of commonly accepted rules that define the limits of permissible action and a balance of power that enforces restraint where rules break down” such as “no major power would act unilaterally to acquire territory, none would interfere in the domestic governance of others, and none would be humiliated or isolated”. “In the early decades of the Cold War, Americans did not believe in world order as Kissinger defines it. There was, at best, a Western order locked in a bipolar struggle with the Soviet Union. And yet, that bipolar system became a world order of sorts, if that can be understood to mean the gradual acceptance by both superpowers of each other’s spheres of influence, their joint opposition to the spread of nuclear weapons, and their desire, especially after 1962, to avert nuclear war…The debates on the health of world order usually hinge on whether the United States, China, Russia, or other powers infringe these global rules”.

Robert D. Blackwill and Thomas Wright elaborates “the world order of the 1990s and early 2000s was rooted in U.S.-led postwar preferences, objectives, and strategies, which were adjusted and further globalized by their successors. To the extent that the major powers agreed on the constraints, limits, and enforcement mechanisms, the world order protected that international system. But now supporters of the old order, including many Americans, should grapple with the implications of shifting balances of power and the transformation of societies. It is not so much that the major powers seek to directly overturn the old order; it is that in many respects the new world and the old rules are in parallel universes…For example, the Belt and Road Initiative does not seek to overturn the World Bank; it simply operates alongside it”. However, “regimes from around the world are unlikely, for better or for worse, to simply accept the kind of liberal ordering that the United States promoted in the 1990s and 2000s. The world has moved away from a standard of world order in which nations work within the same set of constraints and aspire to meet the same set of rules toward a model in which many countries choose their own paths to order, without much reference to the views of others, both near and far. This heterogeneity is not so much a rush to excellence as the projection of the domestic characteristics of the major powers into the international arena. Thus, the corruption, lack of accountability, and absence of freedom in autocratic countries is their version of order”.

Robert D. Blackwill and Thomas Wright points out “the fundamental strategic problem the United States faces with respect to world order is how it should respond to the breakdown in agreed arrangements between the major powers. The United States has a choice. Should it try to reconstitute a world order whereby it forges an understanding with Europe, Japan, India, China, and Russia on the limits of acceptable behavior and how to enforce them, or should it concentrate on improving its own ordering options in accordance with its values regardless of whether China, Russia, or others go along? The answer rests on which course of action best protects and advances U.S. vital national interests. On the face of it, the answer would seem obvious: the United States should try to reconstitute a shared strategic understanding between the major powers based on these national interests – a classic world order bargain, if you will. But such a pathway is problematic. Although it may seem strategically sensible and prudent to many observers, for others the gap between the United States and China is too large to bridge, and a compromise could undermine Washington’s regional alliances. Moreover, there is for the foreseeable future no appetite in Washington on either side of the aisle, or in Beijing, for such a comprehensive effort”.

Robert D. Blackwill and Thomas Wright concludes “these actions are major departures from the shared understandings of the 1990s, and the return of great power rivalry shattered hopes in that multilateral order. China and Russia in particular defend a Westphalian and nineteenth-century model of order organized around balance of power, national sovereignty, and spheres of influence. They oppose the U.S. model of humanitarian intervention, democracy promotion, strengthened alliances, and opposition to spheres of influence. Meanwhile, the United States distances itself from its own world order traditions…The United States finds itself in a world where there is little prospect that the major powers will converge on a single model of world order – with a shared understanding of constraints, limits, and the means of enforcement – as it has hoped for much of the past thirty years…Americans should expect China, Russia, and several others to pursue their own ordering strategies, both in their regions and on global issues. Some grand bargains in world order could be struck in the distant future, but they appear remote now”. “The United States currently appears to be headed for a full-throated permanent confrontation with China, with little diplomacy, constraints, limits, or prospects of cooperation. The volatile piece of the relationship at present is not security competition, which has been relatively stable and predictable. The problem concerns the vulnerabilities created by interdependence…The United States should devise a strategy toward China that defines the scale and shape of engagement. Fully coordinated with allies, this needs to be carefully designed and pay particular attention to trade and finance, including joining a reconstituted TPP, international institutions and frameworks, technology transfer, defense, cyber, critical infrastructure such as communications and energy, and development and investment controls. Without such intense collaboration, it seems unlikely that the United States can successfully and peacefully compete with China, which is likely to be a preeminent U.S. strategic challenger for many decades. Inherent U.S. pessimism about this competition is misplaced. With the proper policies, the United States and its allies can successfully compete with China while avoiding combustible competition and defending alliance national interests and values”.

Fareed Zakaria points out “on measure after measure, the United States remains in a commanding position compared with its major competitors and rivals. Yet it does confront a very different international landscape…Today, the United States faces a world with real competitors and many more countries vigorously asserting their interests, often in defiance of Washington…In these new circumstances, Washington needs a new strategy, one that understands that it remains a formidable power but operates in a far less quiescent world”. “The challenge for Washington is to run fast but not run scared. Today, however, it remains gripped by panic and self-doubt”. “A U.S. grand strategy that is premised on mistaken assumptions will lead the country and the world astray”. “The most worrying challenge to the rules-based international order does not come from China, Russia, or Iran. It comes from the United States. If America, consumed by exaggerated fears of its own decline, retreats from its leading role in world affairs, it will open up power vacuums across the globe and encourage a variety of powers and players to try to step into the disarray…Washington can still set the agenda, build alliances, help solve global problems, and deter aggression while using limited resources – well below the levels that it spent during the Cold War. It would have to pay a far higher price if order collapsed, rogue powers rose, and the open world economy fractured or closed. The United States has been central to establishing a new kind of international relations since 1945, one that has grown in strength and depth over the decades. That system serves the interests of most countries in the world, as well as those of the United States. It faces new stresses and challenges, but many powerful countries also benefit from peace, prosperity, and a world of rules and norms. Those challenging the current system have no alternative vision that would rally the world; they merely seek a narrow advantage for themselves. And for all its internal difficulties, the United States above all others remains uniquely capable and positioned to play the central role in sustaining this international system. As long as America does not lose faith in its own project, the current international order can thrive for decades to come”.

Oleg Barabanov, Timofei Bordachev, Fyodor Lukyanov, Andrey Sushentsov and Ivan Timofeev suggest “the new international order will not resemble any that has existed before. First, there have never been so many independent states worldwide. The most recent international order took shape during the era of European colonial empires (just look at the number of UN members in 1945 and today). Second, the vast majority of these states are capable of independently controlling the space within their borders and making important decisions. Attempts to limit sovereignty in the new world are, of course, inevitable, but they will be indirect and fragmentary and will not be able to realistically determine the behaviour of most countries in the world…even if the degree of dependence of one country on its partners remains high, the push for survival in an extremely diversified world will force it to seek ways to enhance its independent capabilities”. “Even if the great military powers remain in conflict with each other, other countries will not have to divide into warring camps ruled by a hierarchical structure. The experience of 2022-2023 shows that the overwhelming majority of countries in the world refuse to accept such a scenario…large states…will also encounter the fundamental inability to impose their will and desires on others which is a discomforting surprise for countries accustomed to dominance”.

In this context, Thucydides’ Trap is a flawed linear paradigm that over-exaggerates the ability of US and China to dominate the world order and ignores the complexities emanating from multipolarity. Other paradigms may be more suitable for analysis of a multipolar landscape – namely Asian century, Rise of the hinterland, Clash of civilisations, Global entropy, and Messy multipolarity.   

Asians are enamoured by the concept of an Asian century. Kishore Mahbubani explains “history has turned a corner. The era of Western domination is ending. The resurgence of Asia in world affairs and the global economy, which was happening before the emergence of Covid-19, will be cemented in a new world order after the crisis. The deference to Western societies, which was the norm in the nineteenth and twentieth centuries, will be replaced by growing respect and admiration for East Asian ones. The pandemic could thus mark the start of the Asian century…Today, Asia is home to three of the world’s top four economic powers (in purchasing power parity terms): China, India, and Japan. The region’s combined GDP exceeds that of the United States and of the European Union”.

China and India are likely to emerge as the World No.1 and No.3 largest economies in the future. Western ostracization is pushing Russia to meld into Asia which is also opening the economic door for North Korea and Iran. Central Asia and Middle East are being drawn into the Sino-Russian sphere. ASEAN’s economy has benefitted immensely from non-alignment and, with the exception of Philippines, is adamant about not being drawn into the great power conflict. Only North Asia (Japan, South Korea and Taiwan) is clearly aligned with the West but they seem to be suffering significant collateral damage from the US-China conflict. India asserts and practises multi-alignment.

In many ways, the rise of Asia as a potent economic force[6] gives substance to the belief that “the East is rising and the West is falling”. But whether Asia’s economic strengths can be translated into geopolitical dominance is an open question. It should be noted historically neither India nor China, despite each accounting for a quarter of the world’s economy, ventured much outside their current borders. The honour of the largest empire belonged to the Mongols who at one time ruled over most of Asia and parts of Europe. The next largest is Japan which conquered parts of China and most of South East Asia during World War 2.

If the two (or perhaps three) largest Asian countries join hands, this would certainly provide a massive challenge to US and European domination of the world order. But the Asian Century has failed to gain traction so far because the continent lacks a cohesive geopolitical identity. This is understandable given historically the frequency of wars among neighbours and domestic cultural and religious clashes. At the moment, Asia is geopolitically fractured along Cold War lines – with India “joining” North Asia in the Western coalition facing off a China-Russia alliance.

This has much to do with the rivalry between China and India. On the surface, border disputes hogs the headlines. However, it is likely India perceives China as its rival rather than partner for regional and global supremacy. India probably sees itself competing in the same “supply chain” space as China and fears its economy will be over-run by Chinese companies. The economic pay-offs from treating China as an adversary has been significant. It has facilitated India to opportunistically tap into Western desires for a new large-population market and an Asian counter-weight to China and the inflow of Western capital and know-how has underpinned its economic boom.

Jerri-Lynn Scofield points out Foreign Minister Subrahmanyam Jaishankar’s book The India Way explains India’s current approach to managing its international affairs. “This is a time for us to engage America, manage China, cultivate Europe, reassure Russia, bring Japan into play, draw neighbours in, extend the neighbourhood, and expand traditional constituencies of support. The mix of opportunities and risks presented by a more uncertain and volatile world is not easy to evaluate”. Hence, India must prepare for “severe strains in its network of foreign relationships: In a world of more naked self-interest, nations will do what they have to do with less pretence”. “It has to prepare itself for assertions of influence that will exploit power differentials, economic advantages, and dependency of connectivity. The bottom line: India cannot give any other nation a veto on its policy options”.

India is thus emerging as an important “swing” player with foreign policies consistent with its desire for strategic autonomy, Indian primacy on its subcontinent and support for multipolarity. India practises multi-alignment rather than non-alignment and hedges its geopolitical position by remaining friendly with Russia, keeping an eye on Eurasia and the Global South through its membership in SCO and BRICs, cooperating with US to strengthen its presence in East Asia and tapping its Anglo-Saxon heritage. While straddling different camps could backfire, India is keen to avoid Europe’s collateral damage from abandoning strategic autonomy. India instead seeks to maximise geopolitical benefits by flirting with the West, knowing they have a fallback as Russia and China will likely keep their doors open. This upsets the West because it weakens their sanction regimes, yet it cannot afford to alienate India and risks its defection.

Rather than the Asian century, I prefer a broader paradigm – the rise of the hinterland – that encompasses the rise of Eurasia, and the large African and Latin America economies at the expense of the traditional sea-faring powers and international centers. The rise of the hinterland is consistent with the prominence of BRICs, regionalisation and multipolarity. The rise of the hinterland is altering the global patterns for trade, technology, resources, finance, military and security arrangements. The rise of the hinterland augurs a shift in economic power to the Global South and the decline of the West. A growing proportion of global consumption and capital will increasingly be circulated within Global South economies.  New growth centers and MNCs will emerge across the Global South to compete with traditional entrepot and international financial centers. This could potentially disrupt Western financial networks and constrain the ability of Western countries to finance their deficits in the future.

Another broad paradigm is Samuel P. Huntington’s controversial Clash of civilizations[7]. Many have sought to discredit his theory but current developments indicate the Clash of civilisations, while imprecise, is proving remarkably prescient. “Huntington believed that while the age of ideology had ended, the world had only reverted to a normal state of affairs” where “people’s cultural and religious identities will be the primary source of conflict in the post–Cold War world”. Huntington divided the world into the major civilizations as follows:

  • Western civilization – Traditionally Western civilization is identified with Western Christian (Catholic-Protestant) countries and culture. This would cover US, Canada, Western and Central Europe, Australia, Oceania and Philippines. Latin America and former Soviet Union states could be part of Western civilisation or could exist as their own separate civilizations.
  • Orthodox civilization – comprising Bulgaria, Cyprus, Georgia, Greece, Romania, great parts of the former Soviet Union and Yugoslavia. Armenia and Kazakhstan may fall into this category despite different dominant faiths.
  • Sinic civilization – China, the Koreas, Singapore, Taiwan, and Vietnam. This group also includes Chinese diaspora, especially in Southeast Asia. Japan is considered a hybrid of Chinese civilization and older Altaic patterns.
  • Hindu civilization – located chiefly in India, Bhutan and Nepal, and culturally adhered to by the global Indian diaspora.
  • Muslim civilization – comprising the Greater Middle East (excluding Armenia, Cyprus, Ethiopia, Georgia, Israel, Malta and South Sudan), northern West Africa, Albania, Bangladesh, parts of Bosnia and Herzegovina, Brunei, Comoros, Indonesia, Malaysia, Maldives and parts of south-western Philippines.
  • Sub-Saharan Africa civilization – comprising Southern Africa, Middle Africa (excluding Chad), parts of East Africa, Cape Verde, Ghana, the Ivory Coast, Liberia, and Sierra Leone.

Huntington argues “widespread Western belief in the universality of the West’s values and political systems is naïve and that continued insistence on democratization and such universal norms will only further antagonize other civilizations. Huntington sees the West as reluctant to accept this because it built the international system, wrote its laws, and gave it substance in the form of the United Nations”. In relation to this, “Huntington identifies a major shift of economic, military, and political power from the West to the other civilizations of the world, most significantly to what he identifies as the two challenger civilizations, Sinic and Islam…East Asian Sinic civilization is culturally asserting itself and its values relative to the West due to its rapid economic growth. Specifically, he believes that China’s goals are to reassert itself as the regional hegemon, and that other countries in the region will bandwagon with China due to the history of hierarchical command structures implicit in the Confucian Sinic civilization, as opposed to the individualism and pluralism valued in the West…the rise of China poses one of the most significant problems and the most powerful long-term threat to the West, as Chinese cultural assertion clashes with the American desire for the lack of a regional hegemony in East Asia”. “Huntington argues that the Islamic civilization has experienced a massive population explosion which is fueling instability both on the borders of Islam and in its interior, where fundamentalist movements are becoming increasingly popular…Huntington believes this to be a real consequence of several factors, including the previously mentioned Muslim youth bulge and population growth and Islamic proximity to many civilizations including Sinic, Orthodox, Western, and African. Huntington sees Islamic civilization as a potential ally to China, both having more revisionist goals and sharing common conflicts with other civilizations, especially the West. Specifically, he identifies common Chinese and Islamic interests in the areas of weapons proliferation, human rights, and democracy that conflict with those of the West, and feels that these are areas in which the two civilizations will cooperate”.

Russia, Japan, and India are what Huntington terms swing civilizations and who could favor either side. For example, Russia has had clashes with Muslim ethnic groups on its southern border (such as Chechnya) but cooperates with Iran to avoid further Muslim-Orthodox violence in Southern Russia, and to help continue the flow of oil. Huntington argues a Sino-Islamic connection is emerging in which China will cooperate more closely with Iran, Pakistan, and other states to augment its international position. In this context, Huntington wrote that recent factors are contributing to a Western-Islamic clash; such as “the Islamic Resurgence and demographic explosion in Islam, coupled with the values of Western universalism -that is, the view that all civilizations should adopt Western values – that infuriate Islamic fundamentalists”. All these historical and modern factors combined would lead to a bloody clash between the Islamic and Western civilizations.

Huntington argues civilizations will clash because of fundamental differences in history, language, culture, tradition, and, most importantly, religion; increasing interactions which intensify civilization consciousness; by religion replacing longstanding local identities (which are being lost due to economic modernization and social change); and the desire and will of non-Western countries to reshape the world as Western power declines. “Cultural characteristics and differences are less mutable and hence less easily compromised and resolved than political and economic ones…Successful economic regionalism will reinforce civilization-consciousness”. “Non-Western countries can make an effort to balance Western power through modernization. They can develop economic/military power and cooperate with other non-Western countries against the West while still preserving their own values and institutions. Huntington believes that the increasing power of non-Western civilizations in international society will make the West begin to develop a better understanding of the cultural fundamentals underlying other civilizations. Therefore, Western civilization will cease to be regarded as universal but different civilizations will learn to coexist and join to shape the future world”. Certainly, recent events are bearing out his prognosis published in 1996.

Parag Khanna makes the case for Global entropy. He argues top-down frameworks based on American hegemony or great power rivalries “neither capture the shifting global and regional dynamics among more than a dozen primary and secondary powers, nor the deeper systemic change by which a wide range of actors contest authority and shape global society in an irrevocably decentralized direction. Indeed, the most accurate description of today’s world is high entropy, in which energy is dissipating rapidly and even chaotically through the global system…Entropy denotes disorder and a lack of coherence”. “Robert Kaplan’s famous thesis of The Coming Anarchy three decades ago strongly aligns with the entropy mega-trend. Indeed, Kaplan memorably captured the decay underway, particularly in the global south, and the failed attempts by the post-Cold War West to sustain order in those regions…But entropy is not anarchy. It is a systemic property that manifests itself as a growing number of states and other actors seize the tools of power, whether military, financial or technological, and exercise agency within the system…the structure of power is no longer a pyramid but a web with multiple spiders forging networks of varying strength. Today we live in a truly multipolar, multicivilizational and multiregional system in which no power can dominate over others – while all can freely associate with others according to their own interests”. “This structural entropy is embodied in what I call the geopolitical marketplace, a distributed landscape far more complex than the conventional wisdom of a bipolar U.S.-China new Cold War. Many countries in the world are post-colonial nations innately suspicious of overtures that would render them subservient pawns of either the U.S. or China. This is why the notion of alliances is a hollow one for much of the world. Alliances are more like multi-alignments in which swing states, regional anchors and almost every other country actively play all sides in pursuit of their own best deal. This is not about deference to hierarchy but active positionalism: each country, large or small, places itself at the center of its own calculations”. “This is the reality of regional systems, overlapping spheres of influence, and ascending powers willing to say yes or no as it suits them”.

Parag Khanna points out “every geography in the world thus features a complex milieu of overlapping and contested authority among some combination of the five Cs: countries, cities, commonwealths, companies, and communities. The answer to the question who’s in charge? is far from uniform. In contrast to an era where the government was the sole sovereign, authority in today’s polities is an ever more unique combination that depends on the locale”. “The diffusion of power in the technological domain accelerates all this simply by way of states enabling other states – whether by launching their satellites, installing their 5G networks, selling them surveillance technology, training their scientists or engaging in other modes of technology transfer. Now thanks to Starlink, there is WiFi almost everywhere. And anywhere there is WiFi there can be DeFi – decentralized finance – a peer-to-peer marketplace of exchanges and crypto-currencies. We have entered a supply-demand world in which any two nodes in the global network can transact with a third by whichever means they choose. What started as an unregulated and obscure corner of finance has become mainstream as major asset managers such as BlackRock back the crypto asset class with their own ETFs, including bitcoin and other cryptocurrencies. The democratization of decentralized finance may eventually subsume traditional finance rather than the reverse”. In this context, “the dollar, the internet and the modern-era primacy of the English language are symbols of American strength but also default utilities now slipping out of their master’s control. Americans have the loudest English language megaphones on global social media platforms such as X (formerly known as Twitter) and Facebook, but that hasn’t stopped Chinese and Russian state-affiliated groups from bombarding Americans with mind-warping propaganda on TikTok. Regardless of whoever professes to own the global town square, the truth is that nobody controls it. America is clearly not immune from social and political entropy”.

Parag Khanna concludes “if institutionalized orders such as the late 20th-century multilateral system tended to be established only after major wars, would an entropic drift into regional spheres of influence be preferable to a World War III among dueling hegemons? In this scenario, conflicts may flare from Ukraine to Taiwan, but they would be ring-fenced within their respective regions rather than becoming tripwires for global conflict. Regions that strive for greater self-sufficiency, such as North America and Europe today, could reduce the carbon intensity of their economies and trade, but potentially at the cost of undermining their interdependence with and leverage over other regions. Such is the double-edged nature of an entropic world. With no major power able to impose itself on the global system or able to reign in those transnational actors domiciled abroad or in the cloud, the future looks less like a collective of sovereign nations than a scattered tableau of regional fortresses, city-states and an archipelago of islands of stability connected through networks of mobile capital, technology and talent. To argue that there is some bedrock Western-led order underpinning the global system rather than crumbling inertia is tantamount to infinite regress. Global entropy doesn’t solely imply fragmentation. To the contrary, the system exhibits characteristics of self-organization, even aggregation, into new patterns and formations. Highways, railways, electricity grids and airlines link cities in ways that form neo-Hanseatic networks and alliances, and the internet transcends borders to link self-governing social communities. The universal reach and penetration of connectivity enables authorities of all kinds to forge bonds effectively more real than the many states that exist more on maps than in their peoples’ reality. The world comes together – even as it falls apart”.

The term Messy multipolarity was proposed by EU’s top foreign-policy official Josep Borrell. Josep Borrell[8] considers US-China competition as the most important trend and points out “the world is being structured around this competition”. However, the world will not be purely bipolar and will exist in the form of a messy multipolarity. “There are middle powers and swing states that don’t take a firm side in the new cold war…We have multiple players and poles, each one looking for their interest and values. Look at Turkey, India, Brazil, South Africa, Mexico, Indonesia. They are middle powers. They are swing states – they vote on one side or the other according to their interests, not only their theoretical values…This creates this messy multipolarity”. Borrell admits “much of the Global South is neutral in this new cold war between the US and EU on one side and China and Russia on the other…These people do not want to be forced to take sides in this geopolitical competition. More [importantly], they feel that the global system does not deliver, and they are not receiving their part. They are not receiving enough recognition. They do not have the role they should have according to their population and their economic weight. And when facing these multiple crises – these multipolar crises – financial, food and energy crises – it is clear that they are not there following us because they blame us, rightly or not”. Hence, Borrell concludes “the international political order is in a period of messy multipolarity, describing it as a world of radical uncertainty, where the speed and scope of change is exceptional.” Messy multi-polarity is an interesting paradigm because it highlights the predicament of US allies in relation to their lack of attractive strategic choices arising from the decline of the West.

Overall, paradigms range from narrow to broad. The narrow paradigms tend to be static and limited while the broad paradigms can be used to analyse complex and fluid scenarios. Cold War 2.0 implies bipolar US-China conflict and comes closest to affirming Thucydides’ Trap and the inevitability of a world war. The Asian century and the Rise of the hinterland affirm the thesis that the East is rising and the West is falling. The Clash of civilisations suggest alliances will be formed by cultural affinities. Global entropy reflects a complex distributed landscape that is multipolar, multicivilizational and multiregional. Messy multipolarity best captures the realpolitik of the current global landscape. Messy multipolarity implies an extended period (decades) of constant conflicts and shifting allegiances reminiscent of the Warring States period in ancient China. None of these paradigms suggest the declining power of the West is likely to be reversed.  At most, the decline of the West can be interrupted by earth-shaking events like a global depression, financial crises or war. In the aftermath, it is unclear if they would recover their dominance.

The battle for allies

In the multipolar landscape, a great power’s strength is dependent on the depth of its alliances. The battle for allies is thus of strategic importance. It can be viewed as a form of Geopolitical Go where the great powers “weave alliances by positioning their stones (MNCs, military, economic policies) to expand their space and restrict the adversary’s space. Players seek to strengthen the cohesiveness of and expand the size of their alliances while disrupting the adversary’s alliance. Strategies may also require trade-offs – the sacrifice of some stones to gain an advantage elsewhere. The modern geopolitical landscape is multipolar and multiplayer; and most battles take place in the information rather than physical realm. This leads to chaotic and escalatory conditions because players tend to attack in areas where they have an asymmetric advantage. Hence, the US exploits its asymmetric advantages in terms of its geopolitical alliances, its military coverage, and its leadership in technology and finance. Russia leverages on its energy and resources. China leverages on its industrial production efficiency and scale. In asymmetric warfare, players do not easily cede ground because they receive little benefits for concessions and end up at a perpetual disadvantage. Asymmetric warfare tends to provoke over-reactions; with countries tending to harden the terrain in spaces where they operate at an asymmetric disadvantage to eliminate the adversary’s leverage”. “Geopolitical Go is comparable to an infinite game where the boundaries are constantly changing, the number of participants and realms are continually expanding and a final victory is elusive. if there is no such thing as a final victory, then it raises questions as to what the players are fighting for” [9].

The battle for allies is intensifying as US-West and China-Russia compete to strengthen their alliances and weaken those of their adversaries. The US has expanded its alliances from the Cold War by adding more European countries and incorporating the advanced North Asian economies. The surprise was US’s remarkable success in convincing allies to abandon strategic autonomy and to stomach collateral losses. Perhaps Western governments and MNCs acknowledge that conflict with Russia and China is inevitable and that it is better to be align and fully support US strategies.

The US is busily organising groups targeting different areas in a holistic approach. The US uses China’s relationship with Russia to drive a wedge between China and its European allies and exploits the South China Sea tensions to drive a wedge between China and its Asian allies. On the military front, the US has solidified the Europe-NATO alliance and prompted Taiwan, Japan, South Korea, the Philippines and Australia to be more confrontative and to militarise. It is also pivoting to India to keep China off-balance. On the geoeconomic front, more allies have denounced China as a “threat” and supported US efforts to de-risk China supply chain dependencies; block market access, technology transfers and investments, press China on issues relating to Taiwan, South China Sea, Ukraine and Israel, and trade and human rights.

What may have surprised the West is the wide rebuff to their overtures in the Global South. Successes, like the Philippines, are limited while long-time allies like Saudi Arabia and new allies like India vigorously defend their strategic autonomy and neutrality. Time and again, the West finds itself isolated – with lukewarm support or even facing opposition – on issues related to China, Russia, Ukraine and Gaza. The Middle East “has suffered from growing disenchantment with the United States…Countries and populations felt that a closer relationship with China would give them the ability to resist U.S. hegemony and resist demands to reshape their domestic and foreign policy to reflect U.S. preferences”[10]. The African Sahel[11] has pushed back against Western neocolonialism by ejecting Western military forces. Global South countries prefer to maintain relationships with China and Russia because:

  • Either from colonial history or recent experiences, developing countries generally view the West as self-serving and hypocritical. The West has also increasingly weaponising “values” such as security risks, human rights (labour, LGBTQ, feminist) and climate change[12]. Global South exports such as palm oil, timber, textiles and industrial products have been subjected to sanctions and tariffs. The West has, often enough, ignored multilateral agreements and trampled over national sovereignty. On the other hand, countries that did not comply with one-sided laws and Western dictates found themselves hit by sanctions, assets being frozen or expropriated, and their access to technology and global finance system withdrawn. The Global South are well versed with the risks of being solely dependent on the West.
  • Global South countries usually get lip service and their needs are neglected or short-changed. Recent examples include shortages of vaccines, medical supplies, oil, fertiliser and food. Global South countries also face threats posed by rising Western interest rates, currency volatility and reshoring. In addition, the collateral damage suffered by Europe has been an eye-opener on the costs of supporting Western sanctions. Global South countries are keen to avoid getting dragged into a global conflict and understand that they should be assertive in looking after their own national interests.
  • As Western influence diminishes, the bargaining power of Global South countries rises. Developing countries are demanding better terms for geopolitical cooperation and for access to their resources and markets.
  • The West tends to insist countries comply with their sanctions and other conditionalities. In contrast, China and Russia endorse non-alignment and do not require countries to restrict relationships with the West. In addition, China and Russia downplay the military and geopolitical elements and focus mostly on bilateral economic needs and connectivity. Global South countries have the fallback option of relying on Russia and China for resources. This includes food, oil, metals, fertilizers; infrastructure financing, industrial products, military hardware, technology and debt restructuring concessions.

The West still holds the advantage but time is working against them. In Europe, German party AfD’s Maximilian Krah[13] argues “what we see today is the complete destruction of the German economy and the German manufacturing industry because of this new foreign policy approach of America” which resulted in cutting off cheap energy from Russia and exports being constrained by “a global sanctions regime designed by the United States”. The issue of not having to choose between US and China. “The question is, do we have a choice between America and being more or less independent?” “We are not just bystanders when our industry gets ruined…There is no understanding at all of the changes in the world and the competition with China. The German elites follow phantom debates, which are focused on climate, on moral issues, on human rights – but are not focused on economic growth, on our share of international trade, on our influence in economic relations…in the long run, I’m convinced that the world of the future is a world of multipolarity, which is not run by Washington, DC, and Brussels anymore”.

Stefan Lehne notes “as the balance of global economic and political power is shifting away from Europe, frustration and anger are boiling up…The European counterpart of the Global South is the concept of Fortress Europe promoted by populist-right forces in EU countries. It is the most dangerous frame of all, as it goes together with antimigration, anti-Islam, and nativist attitudes that aggravate the South’s mistrust of and hostility toward Europe. The EU is surrounded by heavily populated regions, with which it is connected through a dense network of ties. Were a Fortress Europe mindset to prevail, this would greatly damage Europe’s economic, cultural, and human relations with its neighbors as well as harm economic development, exacerbate governance problems, and undermine stability in neighboring regions. Both the EU and its surrounding regions would be much worse off, and Europe’s relations with other parts of the world would take another downward turn. In responding to the pressures of a geopolitical world, the EU has to become more resilient, but it can never be isolationist. It has to become more protective of its interests but not protectionist. And it cannot become a fortress but should, on the contrary, act as a hub for a broad coalition of countries interested in preserving an orderly world. Several decades of globalization have resulted in a dense network of ties and multiple interdependencies that can only be abandoned at huge cost. The vast majority of governments understand that the future prosperity of their countries requires a high level of international cooperation, which needs a functioning institutional and legal framework…much of the political elite, particularly in the South, considers the current international order deeply flawed and in need of repair. As long as the EU is perceived as a staunch defender of the status quo, the gap that has opened up in recent years between the union and much of the rest of the world will continue to widen. It will begin to close if the EU succeeds in positioning itself as a force for reform. Multilateral diplomacy, for instance, is an area in which the EU remains influential, although it has lost some ground over recent years…The temptation to scale back the EU’s international engagement to concentrate on protecting core interests is strong. But if this attitude prevails in shaping the EU’s policies, it will only accelerate Europe’s decline. The truth is that the EU still has enormous potential, and many countries across the world look at the union as a crucial ally in safeguarding and strengthening an orderly world. The EU can only exploit this potential, however, if instead of retrenching, it seriously enhances its international engagement. And this, in turn, will require considerable leadership and political will. The work on turning the tide of global opinion starts at home”. In this regard, “the EU’s reputation in much of the rest of the world has a serious problem…EU foreign policy has always been marked by a set of somewhat contradictory ambitions…the union projects the self-image of a global actor on a mission to promote a rules-based order across the globe. This image sometimes goes together with traces of an old sense of superiority shaped by centuries of Europe’s dominant position in the world…Many in the European foreign policy community now believe that the EU needs to draw the conclusions of its declining influence, abandon its global ambitions, and focus its foreign policy even more on its immediate neighborhood…The EU’s prosperity depends on worldwide trade, its security on intercontinental partnerships”.

Similar to Europe, North Asian allies such as Japan, South Korea and Taiwan face similar pressures. Confronting China have had massive consequences. North Asian MNCs have been hard hit by the technology sanctions which damaged their China business and fostered the emergence of Chinese competitors. At the same time, Chinese competitors are taking away their market share in China and in third markets. Reshoring away from Asia is also disadvantageous is it has meant distractions and higher costs. In summary, the strategic dilemma for US allies is that what is good for the US may not be in their national interests. Yet they are constrained in setting an independent course to pursue their own interests because this would undermine US efforts to bolster the position of its alliance vis-à-vis China and Russia.

China’s approach to building alliances

It is interesting to analyse how China has approached building alliances because what has really turned the tables has been the competition between the rival economic and ideological models. In Cold War 1.0, US advocated free trade and markets. Joining its alliance assured opportunities for economic advancement and prosperity. US’s ideological rhetoric has stayed unchanged but the rest of the world has moved on from ideology towards civilisational and religious identities. Worse still is that the US has been backsliding on its economic model. The US has turned protectionist and insist allies support its efforts to contain Russia and China. Now being a member of the US alliance means accepting economic sacrifices from cutting off trade and investments with adversaries.

China’s approach to alliance-building is interesting because it represents an upgrade over Japan’s export-led model. For most developing countries (excepting China, South Korea and Taiwan, Japan’s export-led model promoted foreign enclaves with manufacturing dominated by global MNCs. In contrast, China’s approach involves exporting its economic model to assist Global South development.

Lauren Johnston reveals “a changing relationship between China and Africa, moving beyond a focus on mainly oil and extractive commodities. The new focus is more on industrial production, job creation, investments that lead to African exports and productivity-enhancing agricultural and digital technology opportunities”. The Hunan model promotes: “medical cooperation, poverty reduction and agricultural development, trade, investment, digital innovation, green development, capacity building, cultural and people-to-people exchange, peace and security…For China it may lead to new sources of food security as well as new markets for technology products and opportunities to set technology standards. The approach thus places Africa in an important position for grasping new opportunities and shaping related areas of cooperation – at home, with China and globally…There are also efforts to tackle issues of access to foreign exchange and foster greater use of local currencies”.

In the Middle East, Faris Al-Sulayman and Jon B. Alterman note “China has established itself as an essential partner in Gulf states’ energy transitions. China and Chinese companies have built on their ties with Gulf states in the oil and petrochemical sectors and have gradually transitioned to higher-value inputs in the renewables sector, becoming investors and co-investors in Gulf states’ largest-scale solar and wind projects in the Middle East and beyond”. Thus, China offers Global South an alternative developmental path with opportunities to leapfrog technologies (5G, green technologies, EVs which can lead to considerable cost savings on oil imports), and hardware & AI that they may need for their military or surveillance.

Ryan C. Berg notes China’s emergence as “the top trading partner for many countries in South America and the second-largest trading partner for nearly all of Latin America and the Caribbean (LAC)…BRI invests in large infrastructure projects in 21 of LAC’s 34 countries, including sensitive infrastructure such as nuclear power and space stations…China has become a key provider of financing to many countries in LAC – to the tune of hundreds of billions of dollars – through its state-backed policy banks and its commercial banks. This is to say nothing of China’s growing soft power in LAC through a proliferating number of Confucius Institutes, policymaker and military-to-military exchanges, a presence in multilateral forums such as the Community of Latin American and Caribbean States (CELAC), and the International Liaison Department’s close working relationship with hundreds of political parties in LAC”.

In tandem with this, China is redirecting its economic resources from the West to the Global South. Jacob Dreyer notes “Chinese exports to the Global South now exceed those to the Global North considerably – and they’re growing. The International Monetary Fund expects Asian countries to account for 70% of growth globally this year. China must shape a new international system that is conducive to hedging against the negative impacts of the West’s decoupling…former People’s Liberation Army theorist Cheng Yawen wrote recently. That plan starts with Southeast Asia and extends throughout the Global South, a terrain that many Chinese intellectuals see as being on their side in the widening divide between the West and the rest. The idea is that what China is today, fast-growing countries from Bangladesh to Brazil could be tomorrow. China isn’t exporting plastic trinkets to these places but rather the infrastructure for telecommunications, transportation and digitally driven smart cities. In other words, China is selling the developmental model that raised its people out of obscurity and poverty to developed global superpower status in a few short decades to countries with people who have decided that they want that too. The world China is reorienting itself to is a world that, in many respects, looks like China did a generation ago. On offer are the basics of development – education, health care, clean drinking water, housing. But also more than that – technology, communication and transportation”. In this context, “if the Chinese economy is the set of processes that created and create China, then its exports today are China – technologies, knowledge, communication networks, forms of organization. But is China a place, or is it a recipe for social structure that can be implemented generically anywhere?” “For many countries in the Global South, the model of development exemplified by Shenzhen seems more plausible and attainable. Nobody thinks they can replicate Silicon Valley, but many seem to think they can replicate Chinese infrastructure-driven middle-class consumerism…prepare for every city in booming Asia to start looking like Shenzhen. If you like clean streets, bullet trains, public safety and fast Wi-Fi, this may not be a bad thing. Chinese trade with Southeast Asia is roughly double that between China and the U.S., and Chinese technology infrastructure is spreading out from places like the Huawei University at Indonesia’s Bandung Institute of Technology, which plans to train 100,000 telecom engineers in the next five years”. “China can now offer these countries the possibility of building their own future without talking to anyone from the Global North”.

Clark Banach and Jacob Gunter analyses how China has expanded its influence by investing in ports. The “growing constellation of Chinese port activities has had a significant impact on total trade with China over the past 20 years. Typically, we see a trend towards more exports to China as control over terminal operation increases. This means that Chinese firms are buying a greater share of their goods from these countries than ever before…As the level of control at the port increases, total trade also increases with China…trade flows indicate that trade is being diverted away from their former trade partners in favor of trade with Chinese firms…Total trade with China is expected to increase about 21 percent after a terminal operating contract is signed and exports to China usually increase more than imports…Expected increases are magnified if Chinese firms have a controlling interest in all terminals, in at least one port in the country. In these cases, over a 12-year period, exports to China would be expected to increase by 76 percent, whereas imports from China would be expected to increase by 36 percent…Host countries that allow Chinese firms to operate all terminals in at least one port saw a 19 percent reduction in exports to the rest of the world during the analysis period…Chinese firms buy more goods than they sell to the host countries after operating agreements are signed and much of the cost savings go to the Chinese”. “These results indicate that hypothetically, a country could maximize the economic benefits of cooperation by allowing Chinese SAEs to operate one or two port terminals, while also negotiating regular maritime infrastructure development projects that diversify import and export partner during construction”. “China’s network of SAEs acts as a quasi-supranational organization seeking to establish a global footprint. Host economies may gain from greater trade, increased commerce and cheaper goods but the price tag includes institutional lock-in and loss of diversity in trade partners”. “Although the official Maritime Silk Road (MSR) serves as a primary channel for international flows, additional port contracts with Chinese firms can be considered tributaries along a wider network of influence. Countries along this extended MSR can transact relatively easily with Chinese firms due to shared standards and practices along the supply chain…The BRI’s stated objectives include policy coordination, facilities connectivity, unimpeded trade, financial integration, and people-to-people bonds. This reduces uncertainty as well as the transaction costs of trade between partners, which can manifest as fees, commissions, insurances and legal expenses, along with the time required to procure these services. In a world increasingly interconnected by trade, transaction costs play a pivotal role in shaping economic relationships”.

Clark Banach and Jacob Gunter thinks “the BRI will evolve to become greener and tech focused…projects would become smaller scale, more financially sustainable, and more focused on facilitating trade and greenfield investment. Furthermore, Xi emphasized the importance of softer dimensions of connectivity now that hard infrastructure is in place”. “Xi’s signature foreign policy initiative has not always generated results that enhance Beijing’s interests and reputation. Some BRI projects were too large for the recipient country, the debt proved too great for others, or systems that could use finished projects efficiently were neglected. However, the BRI has advanced the party-state’s goals in ways that far exceed any defaults or criticism by foreign partners”. “Port projects have done much to promote Beijing’s interests and enhance China’s economic security. Access to raw materials – from soybeans to iron, lithium and cobalt – is more certain, as are transport links to growth markets for China’s exports. COSCO has been able to grow its market share more readily alongside the global web of ports wholly or part-owned or operated by Chinese entities. Equally, the BRI has boosted Chinese rail companies, energy firms and oil and gas players. All have new footholds in emerging markets, and a bigger global footprint, making Beijing more influential and secure”. “The BRI will likely be a platform to facilitate exports of that overcapacity, using green energy projects to stimulate demand overseas”. “Meanwhile, telecoms infrastructure giants like Huawei and ZTE are likely to become increasingly reliant on the Digital Silk Road[14] as more developed economies impose restrictions on Chinese involvement in building their 5G networks. As China completes the bulk of its own 5G network, the pressure to find alternative revenue streams will grow. The outcome may be to accelerate upgrades or roll outs in the global south on favorable terms from China Inc”.

In addition, Russia and China are taking separate paths to alliance building to avoid geopolitical minefields such as the tense relationship between China and India and irreconcilable differences between Russia and Europe. To leverage on their respective strengths, Russia takes the lead on strengthening relationships with sanctioned economies such as Iran and North Korea in open defiance of the West. China continues to tread cautiously to avoid damaging its global trading relationships with the West and rest of the Global South.

How should US and West respond?

There is recognition that China’s sophisticated relationship-building strategies is diminishing the value of Western economic relationships to the Global South. On this note, the West has tended to curb Global South access to its markets. For example, Zainab Usman and Tang Xiaoyang notes “rising barriers to market access in advanced economies are likely to push African countries further into the embrace of China. Between 2021 and 2024, the administration of U.S. President Joe Biden has suspended a record eight African countries from the U.S. trade preference program, the African Growth and Opportunity Act. Meanwhile, the European Union’s Carbon Border Adjustment Mechanism, which began its initial transitional phase in October 2023, could make it even more difficult for African manufacturers to export to the European market and reduce the continent’s GDP by up to $25 billion”. Thus ad hoc offers to Global South countries are seldom sufficient to switch their loyalties.

The problem is that the US strategy is based on containment. This requires the US to cajole other countries, with the threat of secondary sanctions, to join in its efforts to contain adversaries. The West cannot afford to over-exercise sanction power as excluding too many countries diminish their influence and goad their adversaries to get closer. The problem for the West is that their efforts to win over the Global South often meet with scepticism[15]; that their offers are ad hoc, resource-short, unreliable and burdened by ideology and conditionalities. The benefits of alignment with the West are not as obvious as the losses which can be substantial. So far, the Global South largely take their cue from China and Russia. Problems in Gaza has also set back Western efforts to build alliances with Muslim countries. India, despite enjoying Western favour, continues to insist on multi-alignment. Generally Global South economies think they are in a strong bargaining position and tend to hold out for better offers.

Not only is the US is fumbling for an effective strategy to garner greater support from the Global South, it constantly faces similar challenges with its allies. The US has enjoyed success in leading and institutionalising coordination with allies against Russia and China. While Europe and North Asia understand the need to be committed to supporting US leadership, nonetheless economic costs are mounting and domestic conditions are deteriorating. There are signs that China will begin to retaliate forcefully which will further increase the costs. It is unclear how long Europe and North Asia would be willing to sacrifice their self-interests. The US need to address the growing doubts over the economic benefits of being a member of its alliance and provide the leadership to address the bigger challenge emanating from the West.

China, together with Russia, seems to have focused on broadening the membership of BRICS to increase its economic clout and legitimise its claim of representing the Global South. Initially the US expanded the number of regional arrangements to cater for specific tasks but fragmentation leads to dispersion of effort and to confusion. One possibility is to refashion G7 – which has been an emblem of the decline of the West – by expanding membership to bump up the Group’s economic weight[16]. Potential candidates are other top 20 developed economies such as Australia, South Korea, Spain, Netherlands and Switzerland. However, the drawback is that the elitist prestige and focus of the G7 may be diluted and there may be overlaps with other groups such as the EU. Another possibility is to invite key Global South countries such as India and Saudi Arabia. However, this would change the identity of G7 while it would not be evident that these countries would accept the offer as they would be wary of the motives.

Overall, US policy choices over how it would manage relationships will be the dominant factor reshaping the multipolar landscape. The key question is whether the US would ever accept its unipolar dominance has ended and how it would adjust to a world that is ideologically diverse and commercially convergent? It is not an easy transition. Even if the US shifts from its “rules-based” order to a stance of accommodation and compromise, there are risks that its grip over the Western alliance could weaken. Alternatively, it is up to China and Russia to bridge their credibility gap and to convince others that their concept of a multilateral order[17] based on non-alignment and non-interference is a viable proposition.

Force #2 – Military warfare

Escalating conflict

“The Russian invasion of Ukraine signalled a transition in the great power conflict from the opening phase into the middle game. The opening phase was characterised by preparatory and choreographed moves generally within the confines of established guardrails. In contrast, the middle game is chaotic with intrusive probing of red lines and creation of new pressure points. In the early parts of the middle game, the conflict is largely asymmetric rather than head-on. The US sharpened its attack on China’s weak spots (Taiwan, India, Xinjiang, technology and finance) whereas China is exploring and exposing weak spots on US flanks (Eurasia/Latin America and currency). The asymmetric nature of the conflict lowers the value of defence and increases the value of attacks. The middle game is a dangerous, confrontational phase”[18].

In recent months, the pace and intensity of military and non-military hostilities has picked up and become more tactical in nature. The arms race has restarted and influence campaigns and proxy wars are intensifying. China and Russia seems have reached a point where they are prepared to openly challenge Western “rules” and sanctions, and to expand and elevate retaliatory actions. Asymmetric warfare is steepening the escalation trajectory and increasing event risks that could trigger direct military hostilities.

But war no longer offers resolution nor benefits

In this context, military confrontation is no longer a means to conflict resolution. Technology has transformed wars to become destructive, costly and generally unwinnable. Technology has converged military-civil use of technology and lowered the costs and increased the availability of relatively sophisticated weaponry. Military-civil fusion has been a great equaliser in narrowing the gap between strong and weak armies; thereby making it difficult to land a knock-out blow. Wars are increasingly waged using airborne devices (drones, missiles) to target troops, infrastructure, tanks and ships. Airborne devices makes it more costly to defend than to attack and increases the difficulty of maintaining control over hostile territory. Soldiers get demoralised fighting against drones and missiles. Without boots on the ground, invading forces cannot exert absolute control; excepting on adjacent territory.

When armies are stuck in a forever war or frozen conflict, it means costs without commensurate benefits. Over time, the economic costs of war will mount and take its toll on the countries involved. Added to that, the loss of lives will not be acceptable in modern societies afflicted by demographic aging. Civilian support for wars abroad will waver if victory is not quickly forthcoming. With the new technologies, none of the great powers will be able to protect their homeland from destruction. In this context, the US has generally never suffered war on their homeland (except for Pearl Harbour). Modern wars also differ from physical wars in that the objectives tend to be ambiguous – security and influence – rather than to vanquish an enemy and claim territory and resources. It is an irony that despite the fact that knowledge diffusion and economic dispersion is reducing the potency of military force, many countries has seen it fit to increase defence spending. There is a need to rethink the role of military force in a geopolitical strategy in a modern landscape.

Strategic stability to persistent instability

The transition from unipolarity to multipolarity is accompanied by a shift from strategic stability to persistent instability. In this context, US overwhelming superiority across nuclear, military and economic domains fostered the strategic stability that was conducive to disarmament during the Cold War era. China’s rise has upset the bipolar equilibrium. “The existence of three nuclear powers magnifies risks related to deterrence, first strike, defences (survivability) and counter-attack. In a tripolar system, it is impossible for each nation to maintain parity with the combined arsenals of the other two. The escalating arms race is triggering nuclear proliferation[19] as other lesser or non-nuclear powers decide they need to build their own capabilities. Growing nuclear power uncertainties will increase geopolitical brinksmanship”[20].

Technology advances are also disrupting strategic stability. “First, it expands the range of possibilities. Complexity, fuzziness and speed make it difficult to define, verify and operationalise controls. Second, technologies such as AI, biotechnology, internet and robotics extends convergence between military and other domains – civil-military fusion. Asymmetric warfare will expand the scope of interdependency weaponisation, harden terrains and escalate conflicts. Whole-of-government approaches will extend confrontation across realms”[21].

George Perkovich suggests the Chinese concept of mutual vulnerability could be used as a bridge to strengthen dialogue between the two sides. Mutual vulnerability means “that two countries or blocs cannot physically prevent each other from inflicting destruction of life and property in each other’s territory that is more costly to them than the value of the territory or stakes they are fighting over”. Mutual vulnerability has the advantage of being a realistic concept that may be used to avoid or limit the arms race and worsening crisis instability. “Without clarity on this, the United States cannot devise a strategy for competing on U.S. terms and offering pathways to more stable relations through dialogue in ways that China and U.S. allies can comprehend”

In the face of an uncertain global reset, the priority for this decade should be to discover paths that can contribute to the re-establishment of global stability in a multipolar setting. Towards this end, there is a need to eliminate the concept of deterrence from policy conversations as deterrence tends to beget escalation. In its place should be concepts that can be used to overcome the lack of trust and that illustrate the benefits from de-escalation, guardrails, diplomacy, peace negotiations, compromise and cooperation. On a bilateral and multilateral basis, there is a need to prioritise and dedicate greater resources to promoting peace[22] and global cooperation. In the current political climate, this seems almost impossible. Perhaps mindsets may change if there is prolonged economic distress, civil unrest and proxy wars. The hard process of reconciliation can only begin once the realities of war sink in.

Military scenarios

The great powers seem to be tottering towards direct military confrontation. Talk is getting louder on NATO intervention in Ukraine and the use of nuclear weapons. China is hardening its responses to what it views as crossing their red lines in Taiwan and the South China Sea. The risk of a direct military confrontation between the great powers, possibly turning into a nuclear-based world war, is rising sharply; albeit from low levels. Generally, there are two categories of scenarios:

  • No war. The base scenario is status quo – no new conflict zones emerging. Narratives may escalate but the actual conflict stays within the bounds of  “near-war”; like the Cold War. Hopefully, the great powers are able to defuse potential face-offs peacefully and asymmetric warfare do not go to the point of compelling a great power to go to war. However, “no-war “scenarios do not rule out a resurgence in proxy wars as the great powers seek to expand their influence and control over minerals in the Global South.
  • War. There are two war scenarios. In the limited scenario, military conflict remains confined to “limited theatres” (like Ukraine currently) and parties respect guardrails to avoid direct military confrontation between the great powers. In the world war scenario, an incident involving loss of lives trigger a direct conflict. Once troops are deployed, it is a short off-ramp to a World War that is likely to be fought with nuclear weapons.

If a war among the great powers breaks out, the outcomes are unpredictable. How long does a war last – particularly if it is fought with nuclear missiles? What happens after the missile strikes – how many human lives are lost and how extensive is the devastation of infrastructure? How does such a war end and how do you determine the victor in a nuclear war? What happens in the aftermath – Is there unconditional surrender (like in WW1 and WW2)? What are the likely terms of surrender (control of administration and restitution). Would it be realistic to expect that losers will be allowed to rebuild their economies (as after WW2) or would losers be suppressed to ensure they could never once again challenge the victor? My analysis for the main conflict zones are:

Ukraine – Will the Ukraine war still be on-going or ended by 2030? John J. Mearsheimer thinks “Russia[23] will ultimately win the war, although it will not decisively defeat Ukraine. In other words, it is not going to conquer all of Ukraine, which is necessary to achieve three of Moscow’s goals: overthrowing the regime, demilitarizing the country, and severing Kyiv’s security ties with the West. But it will end up annexing a large swath of Ukrainian territory, while turning Ukraine into a dysfunctional rump state…Russia is likely to attempt to annex the four oblasts – Dnipropetrovsk, Kharkiv, Mykolaiv, and Odessa – that are immediately to the west of the four oblasts it has already annexed – Donetsk, Kherson, Luhansk, and Zaporozhe. If that were to happen, Russia would control approximately 43 percent of Ukraine’s pre-2014 territory. Dmitri Trenin, a leading Russian strategist…writes that a logical next step after taking all of Ukraine from Kharkiv to Odessa would be to expand Russian control to all of Ukraine east of the Dnieper River, including the part of Kyiv that lies on the that river’s eastern bank. If that were to happen, the Ukrainian state would shrink to include only the central and western regions of the country”. He notes the West continues to hold onto its goals of defeating “Russia’s army in Ukraine – erasing its territorial gains – and cripple its economy with lethal sanctions. If successful, Russia would be knocked out of the ranks of the great powers, weakening it to the point where it could not threaten to invade Ukraine again…The other Gordian knot concerns Ukraine’s relationship with the West. For understandable reasons, Ukraine wants a security guarantee once the war ends, which only the West can provide. That means either de facto or de jure membership in NATO, since no other countries can protect Ukraine. Virtually all Russian leaders, however, demand a neutral Ukraine, which means no military ties with the West and thus no security umbrella for Kyiv. There is no way to square this circle”.

There are many scenarios; some have complex permutations (such as  Russian regime change or defeat, Russia conquering Ukraine or US/European withdrawal of support). My most likely scenarios:

  • Frozen conflict continues. A frozen conflict for six years (2030) and beyond will be costly for combatants. Territorial gains or losses are likely to be fluid. Russians are locked into a war and without a peace treaty will be handicapped in achieving its long-term security and economic goals. Ukraine’s economy is severely damaged and it already relies heavily on Western aid to sustain its defence. However, if the West becomes unwilling to bear the costs any longer, then scenarios (ii) and (iii) become likely.
  • Peace treaty. If Western governments agree to negotiate, what could a possible peace treaty look like? To a large extent, concessions will depend on the military situation. The first issue is over territory. Russia would likely insist on retaining the four annexed oblasts of Donetsk, Kherson, Luhansk, and Zaporozhe and a buffer zone at least. Ukraine may be unwilling to make any territorial concessions and this is a major sticking point. The second issue are the security assurances between NATO and Russia. This involve commitments on Ukraine neutrality (non-NATO membership) and mutual commitments between NATO and Russia not to threaten each other’s security interests. The third issue relates to sanctions and reparations. It is possible that in exchange for release of Russia’s frozen assets, Russia may provide reparations as financial compensation for territorial concessions and restitutions for reconstruction. In relation to this, some Western sanctions may be dropped. If a peace treaty cannot be achieved, we may be headed for scenario (iii).
  • Direct confrontation between NATO and Russia. The loss of Ukraine has implications for Western credibility. NATO narratives have turn hawkish with threats to intervene directly. Russia has responded by brandishing narratives on the potential use of nuclear weapons. Hopefully, the hawkish narratives are intended merely as a warning to restrain the scope of military actions. If NATO forces are deployed in Ukraine, It will be difficult to contain the conflict and nuclear war scenarios cannot be ruled out.  

Middle East – Israel has clear military superiority but it should be reminded there is no such thing as a decisive victory. Even if it achieved military successes early on, it will find itself embroiled in a forever war, isolated and hemmed in by hostile neighbours. Over time, its resources would be over-stretched and its economy would deteriorate. Shivan Mahendrarajah thinks “the Israeli military has not defeated Hamas, which continues to inflict significant damage to Israeli military hardware and human assets”. “Internal tensions within Israeli society are escalating, fueled by socio-economic pressures and disillusionment with the government’s handling of the war. The Israeli economy is in shambles. The shekel is declining…Budget deficits and borrowing have skyrocketed. Moody’s downgraded Israel’s credit from A1 to A2 on 9 February. Israel’s tourism industry has collapsed into crisis. Most major airlines no longer fly to Israel. Israel’s manufacturing and agricultural bases are small”. “The IRGC understands that Israel’s economy cannot sustain a prolonged conflict. Therefore, their strategy might involve a gradual escalation – effectively boiling the Israeli frog slowly”. In a 2030 scenario, the main questions are whether the war would expand (e.g. Iran) or whether Israel’s government would consider a two-state solution to end its isolation. A blow-up in the Middle East might drag in the US but other great powers such as Russia, China and Europe are likely to try to stay away from the conflict.

South China Sea and Taiwan – The US has succeeded in mobilising and militarising allies across China’s coastline. It seems to be deploying a cat-and-mouse game of provocation that it probably hopes will fall short of triggering direct confrontation with the Chinese military. China is now responding by hardening the terrain to eliminate the possibly of re-negotiating its red lines and is putting its navy into action. The prospects for direct conflict has risen significantly. There are two hot spots.

  • South China Sea/Philippines. China would take advantage of the provocations to justify its “resolute” response – to permanently fortify defences and beef up its naval presence in the disputed waters. China can afford to be decisive in confronting Philippines because it is mainly defending territorial claims. A limited theatre conflict here is possible. On the other hand, the US might choose to intervene, in which case a stand-off is likely.
  • Taiwan. Taiwan is different as reunification[24] likely involves an invasion. With the newly-elected government and US crossing China’s red lines on independence, the odds of confrontation has risen significantly. Most simulations focus on a Chinese attack on Taiwan but this is disadvantageous. A direct invasion would result in large loss of human lives. In addition, China understands the main threat is intervention by the US and allied forces and it will design its plans to focus on confronting the West. A more effective strategy is to blockade Taiwan[25] for a lengthy period (leaving the timing for an invasion open), instigate internal insurrection while arraying forces to pre-empt Western interventions. In this situation, China focuses on neutralising US-led attempts to break the blockade. It will be a mistake to treat this as a limited theatre conflict. China would never allow a battle with NATO forces off its coastline to be limited and it would understand that only the threat of a counter-attack on Western homeland can be a deterrence. Therefore, the risk is that a Taiwan incident could trigger a world war.

A naval stand-off in the South China Sea is the most likely scenario. The classic is the US-Russia stand-off during the Cuban Missile Crisis of October 1962. Stand-offs are likely to have strategic objectives – to create a favourable situation from a crisis. This includes galvanising support from allies from NATO, North Asia, India, Australia and New Zealand and using the crisis to turn ASEAN against China. The crisis can also be used to legitimise follow-up actions to further erode China’s industrial and commercial strengths with punitive actions such as a broad trade embargo, the removal of airspace and maritime rights, imposing a broad range of restrictions (including access to SWIFT) and expropriating China-owned assets.

The West could array its forces resulting in a naval stand-off. However, it would need to take into account in both situations that China is likely to be “resolute”; i.e. willing to risk an all-out war. Who would dare fire the first shot? Casualties could trigger a world war. If Western ships or planes cross the lines, they would be at risk. Can the West afford a long stand-off? It is costly for them as they need to constantly resupply the ships. In addition, they are overstretched given their involvement in Ukraine and the Middle East. If the West engineers a stand-off, it would face difficulties in backing down. China will likely feel it has its back to the wall and have little choice but to be confrontational, so there is little prospect of them stepping back to de-escalate. Maybe there is room for a face-saving negotiation with both sides taking a step back. The risk is that time and cost pressures will prompt the West to test Chinese red lines; and inadvertently triggering a war. It takes a lot to master the art of military “stand-offs”.

The economic fallout from a blockade is likely to be substantial. Charlie Vest and Agatha Kratz note “the G7’s coordinated use of sanctions against Russia in the wake of its invasion of Ukraine have highlighted the range of tools on the table. In Washington and other G7 capitals, as well as in Beijing, leaders are now considering the potential for, and implications of, sanctioning China…Some level of sanctioning might therefore also be contemplated in a crisis below the level of invasion, to deter further aggression. Some G7 partners are already communicating to China that actions short of an invasion could trigger economic countermeasures”. Potential triggers for G7 sanctions “might include a military quarantine scenario, where the PRC restricts the free movement of ships or planes to Taiwan; acts of overt economic coercion such as wide-ranging punitive restrictions on cross-strait trade; and major cyberattacks or other disruptions to telecommunications networks on the island…Some of these gray zone actions…come with high global economic costs that could warrant efforts by G7 nations to deter Chinese actions”.

Charlie Vest and Agatha Kratz think “US and its allies could take much more drastic measures against China’s financial system by, for example, imposing blocking sanctions and denying SWIFT access to China’s central bank, its finance ministry, and China’s Big Four banks, which collectively hold one-third of China’s total banking assets…This would effectively freeze China’s foreign exchange reserves held in overseas custodial accounts, making them unusable for the defense of China’s currency or to meet short-term obligations to finance China’s imports or external debt repayments. The bulk of overseas assets of the Big Four banks – amounting to around $586 billion – would be frozen. This represents a floor, not the ceiling, of the global economic disruption from these actions, which are many magnitudes higher. G7 assets in China would also be at risk. It is likely that China would freeze the (relatively small) renminbi-denominated holdings of G7 banks. Chinese banks, facing a sudden shortage of foreign exchange due to asset freezes, would likely fall into technical default on G7 bank-issued debt, totaling around $126 billion. Sanctioned banks would also be cut off from the international dollar payments system”. They estimate “approximately $3 trillion in trade and investment flows could be put at risk, primarily from disruptions to trade settlement”.

I think this is an under-estimate of mutual vulnerabilities from interdependencies. My view is that an “extreme” scenario should factor in a catastrophic overnight breakdown in trade and finance between China and the West. Unlike Russia, attempts to freeze China’s Western assets and to cut China’s banks from SWIFT will result in China not recognising Western currencies, ownership rights and this would lead to an overnight halt in global trade. Would Western nations risk such a catastrophic outcome? As the terrain hardens, the confrontation will soon turn into “a game of chicken”. The situation is dicier than during the Cold War.

Force #3 – Asymmetric warfare and reset of global rules

We are in the “middle game” phase of asymmetric warfare[26] or unrestricted warfare. The West appears to be circling the wagon and preparing, at the secondary level, to deploy a range of military, legal, political and economic power to penalise countries, firms and individuals that do not comply with their policies. This is leading to a broadening and escalation of international conflict across almost every front (i.e. military, trade, industry, resources, technology, services, infrastructure, finance, currency, data, laws, knowledge, culture and content) and almost every geographical space (i.e. multilateral forums, oceans, airspace, and outer space).

It is worth noting the differences between a military conflict (which is physical) and weaponisation of interdependencies (consisting mostly of policy conflicts in the information realm). First, the effects of military battles are relatively quick and visible whereas the effects of policy conflicts in the information realm are relatively slow and intangible. Second, the final outcomes after a military war are definite. Victors are declared, territorial borders and reparations determined and countries can start rebuilding their economies. Due to the slowness of their effects, conflicts in the information realm are indefinite and often irreversible. Policies such as sanctions and asset freezes can’t be easily withdrawn particularly if it hadn’t achieved its objectives. Court decisions on policies, seizures, enforcement and even private lawsuits can’t be easily reversed or unwound. Business relationships damaged by decoupling and business exits can’t be easily repaired. The trend towards production self-sufficiency can’t be reversed. Once policy effects gain momentum, it becomes difficult to achieve compromise in an emotive, polarised and transparent environment. The features of slowness, irreversibility and inability to compromise means it is easier to de-escalate a military conflict than an economic one. Diplomacy is used more often to rein in backsliding allies, to recruit new ones or for grandstanding rather than to negotiate with adversaries. Assurances are regarded as a trap, self-restraint as a weakness and concessions as appeasement. The possibilities and outcomes of asymmetric warfare can be analysed based on different frameworks and revolves around the reset of global rules.

Asymmetric warfare – Analytical frameworks

  • Containment strategy

There is much sentiment attached to containment strategy which is thought to have contributed significantly to the US Cold War victory. Unsurprisingly, containment strategy is being revived. Michael Corbin notes “as of January 2024, the Russian Federation was subject to over 28,000 sanctions and the majority of these occurred after Russia’s invasion of Ukraine in February 2022. Approximately 16,000 of these sanctions were imposed against individuals, while nearly 10,000 were imposed against companies and 3,200 against institutions. Additionally, there have been sectoral sanctions such as general trade embargoes on gas and oil. The EU and the U.S. have imposed most of these but countries like Japan, South Korea and Switzerland have also participated”. The Western sanctions have been comprehensive – seeking to isolate Russia by restricting access to the global financial system (payments, banks and financial services), airspace, ports and technology; freezing and seizing related assets (including central bank reserves); shutting down trade and even sports and cultural exchanges. However, the containment of China started slowly with trade decoupling and has slowly expanded across the economic, financial, technological, information and military fronts with the US seeking to convince allies to fully support its strategy.

Will containment strategy work as it did before? There are glaring differences in the global landscape from earlier decades. The first difference is that US then leveraged on its superior economic model to contain the spread of Communist ideology. Today, the US is attempting to use ideology to contain the spread of China’s economic model. Economics trumped ideology in Cold War 1.0. It is reasonable to assume economics will triumph again; in which case China seems to hold the economic advantage and US the financial and technological edge.

The second difference is the globalised and informationalised landscape. As a matter of comparison, traditional conquests aim to control a country’s resources and markets whereas containment strategy is predicated on isolating an adversary’s economy to starve it from receiving external resources to damage its political stability and military capabilities. For containment strategy to work, the US needs support from other countries to limit its adversaries’ participation in the global system. To a large extent, the US solidified support among developed allies.

But China and Global South countries have rushed in to provide competitive substitutes and to import discounted Russian resources in defiance of the Western sanctions. In fact, even Russia’s import of Western products appears unaffected[27]. Benjamin Hilgenstock Elina Ribakova Guntram B. Wolff and Anna Vlasyuk note Russian “imports have almost fully rebounded in value terms from the drop they went through in the immediate aftermath of the imposition of export controls in spring 2022. In fact, 2023 imports were only 2 percent lower than in the pre-full-scale invasion period…While there is some evidence that Russia is forced to pay significant markups for export-controlled goods acquired through third countries, meaning the decline in volume terms is more pronounced than what trade values indicate, the implementation and enforcement of restrictions appears to be facing major challenges. Russia can thus acquire critical inputs that its economy and military industry require by using producers in China and other countries that have stepped in and replaced suppliers from coalition countries…worrying is the fact that Western technology still finds its way into Russian arms. A substantial share of Russia’s battlefield goods imports – 40.3 percent in 2023 – is produced on behalf of companies headquartered in coalition countries. And evidence from the battlefield shows that Western components still dominate as far as actual weapons production is concerned: 95 percent of all foreign parts identified were sourced from producers in coalition countries, with 72 percent accounted for by US-based companies alone. This could mean that Russia is not able to easily replace Western components with substitutes from, for instance, China. However, it could also mean that Russia has not been required to substitute Western products in weapons because access to such imports remains in place despite export controls. In most cases, albeit not exclusively, these goods are manufactured in third countries and reach Russia via intermediaries located in places including mainland China, Hong Kong, Turkey and the United Arab Emirates. As direct shipments from sanctions coalition countries dropped markedly – accounting for only 5.7 percent of the total value of battlefield goods imports in 2023 (vs. 50.9 percent in 2021) – Russia succeeded in adapting supply chains quickly. Shipments from mainland China made up 56.3 percent (vs. 27.2 percent in 2021), from Hong Kong 19.3 percent (vs. 14.4 percent), from Turkey 5.7 percent (vs. 0.2 percent) and from the UAE 4.2 percent (vs. 0.4 percent)…The $12.5 billion in Russian high-priority goods imports in 2023 was made up of more than one million individual transactions. Coalition authorities simply do not possess the resources needed to investigate all these cases individually. Importantly, the objective is to stop any illicit transaction early enough, so that the good does not reach Russia and its military industry. For companies, it is inherently difficult to establish the end-destination for dual-use goods, in particular when they are relatively widely used mass products”.

Generally, sanctions have not achieved its goals of degrading Russia’s military activities in Ukraine and its economic growth. The failure of containment strategy is proving economically costly to European allies and  undermining the credibility of the West. In this regard, Russia’s existence as a military and resource superpower are not directly threatened by ostracization. Instead, the West has voluntarily given up external and internal control over Russia by freeing it from complying with the international rule-based order and handed it control over its own economy. Russia can now chart an independent path to build or participate in competing spheres and to exploit vulnerabilities and opportunities in contested space (allies and global south countries reliant on Russian energy and commodities) to inflict economic pain. In the meantime, the West find itself distracted by the complications and costs of attempting comprehensive isolation.

“From a perspective of space, the elimination of all dealings with a large supplier and market like Russia also means the West is effectively containing itself by shrinking its own space or sphere of influence. Containment and ostracization cedes space and access; and are, in reality, forms of retreat. In addition, it is difficult to control space and access due to the ambiguous, transient and complex features of information. For example, it is difficult to pin down the nationalities of individuals, firms, finance and technology. Citizenship and ownership can be changed or transferred while flows can be re-routed as borders are blurry, transient and porous”[28]. To a large extent, Russia and China seems to have resisted from retaliating fully and kept their economies “open” which suggests they recognise closing their space is damaging to their own interests. They think they are better off maintaining their openness and continuing efforts to attract external businesses, capital and talent.

One scenario is for Western governments to restrict and reduce MNC participation in China and restrict Chinese firms from expanding in Western markets. This implies that over time, Western MNCs will be forced to, by their government or by China’s, to pull out of China’s markets. Since Chinese firms cannot expand in the West, they will expand in the Global South. For Western MNCs, their home markets are saturated and they have to make up for the loss of China’s market by also expanding in the Global South. China firms have a substantial cost advantage and also benefit from whole-of-government support offering investments and reciprocal market access to the Global South countries. In contrast, Western MNCs are at a disadvantage as their governments are constantly threatening to cut investments and market access via secondary sanctions. In the meantime, Western MNCs are also being distracted by the need to operationalise their ex-China supply chains. Overall, the competition for Global South markets is in effect a contest of dependencies. A win for the West would mean success at containing China’s expansion. But a China win would pose a “shrinking markets” dilemma for Western governments and MNCs. There is a need to factor in the unpredictable impact of India’s rise as a market and emergent competitor in this global contest.

Hence, the West is uncomfortably positioned as its current containment efforts are not producing desired results. Doubling down on containment requires expanding the list of countries, firms and products to be sanctioned. But casting the sanctions net too wide may cause Global South countries to join forces against the West. In this regard, it should be noted the US decision to normalise relations with China – which divided the Communist sphere and isolated Russia – likely contributed to the success of containment strategy during the Cold War. Today, the US seems to be putting pressure on all its adversaries which are driving them closer together. Unsurprisingly, Russia, North Korea, Iran and China are increasing mutual support. As the West increases pressure, it will be a matter of a matter of time before China and Russia openly defy Western sanctions and step up their retaliation. At some point, the costs of containment may rise to a level where it may become unbearable for some allies and either cause them to break ranks or maybe even trigger a war.

  • Weaponisation of interdependencies

A key feature of containment strategy is the weaponisation of interdependencies[29]. Initial versions of the theory were simplistic. “Weaponization of interdependence. Interdependency is a core concept for conflict in the information realm. Weaponizing interdependence theories  is built on the concept of a dominant network owner exploiting asymmetric advantages. Hence, they are effective against smaller countries like Iran, Venezuela, North Korea and Afghanistan because their dependent relationships with the West means the effects are largely one-sided”. The economic war against Russia represents a real-life test of theories for interdependent relationships where there are two-sided adverse effects. It is one thing to weaponise dependencies but quite another to weaponise interdependencies.

Weaponisation of interdependencies is now being tested by the US-China decoupling. In this regard, “China probably thought its strategy of hugging its adversary through deepening interdependence would protect it from hostile actions. It was probably surprised by the willingness of the US, and lately Europe, to accept the adverse consequences from decoupling and an all-out economic war against Russia. A major problem with analysing weaponization of interdependencies among equals is that these conflicts are wholly motivated by geopolitical ambitions and lack economic rationale or even clear strategic goals (apart from defeating the enemy at all costs). Hence, conflicts would continue to escalate as long as the superpowers are willing to stomach the pain from interdependency losses”[30].

China’s approach to weaponising interdependencies, which the West labels as economic coercion, is to deploy a range of informal actions[31] ranging from administrative actions, trade and investment restrictions, to implicitly support public boycotts, and to manage the flow of Chinese tourists and students. Unlike the West’s broad approach, China’s actions tend to be targeted to maximise political pain for their adversaries while avoiding, as much as possible, hurting their own strategic interests.

Cynthia Cook, et. al. argue that for the West “to successfully combat China’s economic coercion, U.S. and allied sanctions must meet six conditions: (1) Sanctions have a minimal economic impact on the sanctioning country. (2) Sanctions have significant impact on actors within China’s decision-making apparatus. (3) Sanctions have controllable and scalable costs. (4) Sanctions are proportional to the sanctioning country’s goal. (5) Sanctions can be credibly signaled before they are deployed. (6) The market for the sanctioned good is controlled by the United States and its allies. Meeting these criteria requires targeted export controls on key goods in China’s supply chain where the West maintains significant comparative advantage in manufacturing capability. This approach allows the United States to credibly impose costs on China so as to combat Beijing’s coercive efforts around the world”. In this regard, they explain “coercion has two fundamental components: deterrence and compellence. Deterrence is threatening to punish if an adversary does something, while compellence is punishing an adversary to change something in its behavior. Put simply, deterrence is proactive coercion and compellence is reactive coercion. As a result of this framing, the economic coercion tools and policies…are not solely meant to degrade Chinese competitiveness. Rather, they are meant to exploit Chinese dependencies within certain supply chains to impose costs on China in a bid to encourage compliance with the objectives of the United States and its allies”. Four potential areas where China is dependent on Western technology were identified – namely advanced epoxy resins, high precision bearings, heavy duty gas turbines, and electron microscopes.

I think conventional thinking on deterrence and compellence is misconstrued in a deep “interdependent” relationship such as US-China. First, responses are asymmetric. China would respond to attacks on its vulnerabilities with a counter-attack on US vulnerabilities. Second, they are lousy bargaining tools. In reality, sanctions or export controls are more effective when there are explicit and specific trade-offs (where both sides agreed on specific commitments after a bargaining process). When the sanction threat is ambiguous, this threat can be brandished repeatedly to achieve multiple objectives. Third, the general experience from sanctions and blockades is that substitutes and by-passes are available. They are just more inconvenient and costly. In addition, targeted governments and industries will fully back the task of achieving self-reliance. This creates massive opportunities for domestic firms while shrinking the market share of dominant firms. Fourth, there is little evidence that sanctions have deterred or changed the behaviour of adversaries. Instead, they have led to escalation and provoked adversaries to be more aggressive. Lastly, once sanctions are imposed, they seem difficult to remove. These generalisations applies equally to US and China.

My view is that the US has sought to turn its asymmetric disadvantage on its head. The US operates at a disadvantage because it pursues a “close” strategy to reduce interdependencies with China whereas China practices an “open” policy to increase interdependencies. But this means China can never fully respond to US punitive measures (sanctions, blacklists, tariffs) without damaging the credibility of its “open” policies. Rather than let China sit comfortably, US has run year-round campaigns against China on the economic (decoupling, derisking and overcapacity) and geopolitical (Ukraine, Taiwan) fronts. For example, the latest round of US tariff increases (including 100% tariffs on EVs) and withdrawal of past exemptions has a relatively minimal direct effect on Chinese imports. The larger effects come from the signalling effect that allies and others should “go all out” against China’s dominance of global manufacturing. The US also uses provocations to bait aggressive responses from China as this would hurt its image. But it keeps the geopolitical temperature at the right levels – to minimise the risks of forcing an overly aggressive Chinese response. If the damage is too extensive, China would no longer hold back and would threaten US strategic interests in a counter-strike to end further provocations. We seem to have reached that stage of intolerance.

I think China has given up on the US relationship and has begun to manage the downsizing of bilateral exposures. For other Western countries, China seems to have adopted a rotation strategy. When its relationship with Australia worsened, it switched from Australian to European wines. Now that it ties with Europe are worsening and the China-Australian relationship is improving, it is rotating back to Australian wines.

Overall, weaponisation of interdependencies, wielded as part of containment strategy, is a blunt tool to control an adversary’s access. It is difficult to calibrate weaponisation. If the controls are lax, they will be easy to bypass. On the other hand, if the controls are tight, they could result in an unintended shutdown (which may not be the desired result). Weaponisation controls are costly and inefficient. The private sector would need to make declarations. Compliance costs and legal risks can be substantial. The government would also need a bureaucracy to conduct oversight and enforcement.

My final observations are that the economic impact of weaponisation are different in US and China. First, US protectionist measures (such as tariffs or import bans) have generally led to domestic price inflation (higher costs for its consumers) while China’s protectionist measures do not seem to have had a significant price impact. Protectionism has a heavier price impact in the US because its main and lowest cost supplier is China. And the routing of Chinese imports through connector economies adds on additional layers of costs. In addition, US firms operate in a less competitive environment, are focused on profit optimisation and prefer to increase prices to consumers. This is not the case in China where tariffs are selective and it is relatively easy to find competitive substitutes from other countries. In addition, the Chinese market is highly competitive while the government is alert and reacts to rising price pressures in sensitive areas (food, services). Also, producers affected by protection, have to scramble to replace the loss of China’s large market and to divert their supply to global markets which puts downward pressure on prices. Second, US sanctions and controls have reduced market space for US MNCs (the loss of the China market). In contrast, US sanctions and controls have opened up market opportunities for China’s MNCs in their domestic market and underpinned their expansion in third countries (especially Russia, diversion of exports to US to third countries).  

  • Network competition

The emergence of peer-to-peer networks makes strategies for containment and weaponisation of interdependencies obsolete. In this regard, it should be recognised that there are two types of containment. The mild form is limited weaponization which limits the activities of adversaries but allows them to remain within the network. This allows gatekeepers of the dominant network to inflict damage on adversaries while maintaining panopticon (information) and chokepoint advantages. The extreme form is ostracization which not only aims to bar a country from participating in its network but also attempts comprehensive isolation. Ostracization completely negates panopticon benefits. The West’s loss of access to Russia’s information reduces the potency of the dominant network. In addition, it reduces chokepoint advantages as Russia’s expulsion means it is no longer subject to Western rules and enforcement on their chokepoints (IPs, agency rights and finance). In any case, containment and weaponisation strategies can, at most, hinder an adversary’s advance and buy time. Over time, adversaries will likely find solutions to by-pass obstacles in a peer-to-peer network.

In this context, the expulsion of Russia from the Western network implicitly assumes it would hurt the adversary more than it hurts the network and its members. However, the expulsion of Russia raises new strategic challenges. Networks thrive on openness and scale. Expelling major participants shrinks the size and value of the dominant network. Similarly, there are limits to the West’s ability to apply secondary sanctions. The more countries and firms expelled, the greater the loss of influence of the dominant network. In addition, adversaries are incentivised to set aside differences to work together. Thus, China and Russia are cooperating to build an alternative to the Western-dominated network. In tandem with this, China and Russia have begun re-directing resources and flows away from the West towards each other and potential allies.

Given the difficulty of maintaining controls in a peer-to-peer network, then asymmetric warfare should be viewed as a form of network competition  with the dominant network facing challenges from upstarts. At the start, the new networks may be inferior to the dominant network which benefits from the presence of large and sophisticated players and established legal processes. Nonetheless, the dominant network will face a serious competitive threat for the first time. As in commerce, start-ups are unencumbered by legacy and can offer unique value propositions. First, it can leapfrog legacy architecture and operate highly-efficient digital currency models offering almost-instantaneous settlement to drastically reduce hedging and financing costs, and counterparty and settlement risks. Second, it can offer anonymity from Western oversight and probably immunity from extraterritorial sanctions. There is a lot of “informal” finance that would welcome protection from anti-money laundering (AMLA) and sanctions oversight. Third, since global intermediaries are unlikely to be able to participate in the alternative networks, this creates a space to nurture non-Western intermediaries as formidable global competitors. The start-up network is likely to have lower costs and will likely offer incentives to pinch customers from the dominant network. Lastly, there is a difference between the Western approach that emphasises on punishment to ensure compliance as compared with the Russian-China approach that offers large profit opportunities to those willing to risk Western sanctions. The biggest problem for the West is that as the coverage of its comprehensive sanctions expands, it is to a large extent damaging its own network and intermediaries. The range of self-inflicted wounds include loss of space (scale) and connectivity, damage to currency, asset and collateral functionality, and loss of liquidity and efficiency. Its system is getting clogged up by compliance and legal risks and disputes over seized assets. At the extreme, this could trigger the implosion of the dominant network.

Will US and its allies tolerate the presence of an alternative network to rival their network; particularly if it is competitive and disruptive? This depends on its impact. If the upstart network grows rapidly to the point where the dominant network starts to noticeably contract (in size and value) or become unstable, the West would need to respond. Assuming they can’t shut down the upstart networks (it would need to win a war to do so), the West can decide the level of linkages (inter-connectivity rules) with competing networks which covers a broad spectrum. It should be mentioned that there is likely to be a multitude of networks and network competition should be viewed within the context of network fragmentation.

In any case, there are limits to government power to enforce controls. Controls and prohibitions create massive profit opportunities for the private sector. Without the cooperation of adversaries, there will be information blackouts that will facilitate bypassing the controls (e.g. smuggling). Controls (rules) will determine the degree of geoeconomic fragmentation; e.g. rules on use of adversary currencies. Hence, the reset of global rules will emerge as the key challenge in an era of network fragmentation and competition.

Reset of global rules

Given recent events, relationships between the two economic powers look poised to break down even further. The bad news for the global economy is that prospects of de-escalation – an unwinding of sanctions and tariffs – appear slim. Instead, there will be a mild form of deglobalisation; namely geoeconomic fragmentation where trade, capital, information and labour flows will mainly re-circulate within rather than across spheres. Each sphere will (aim to) be self-sufficient but this implies there will be inefficiencies in terms of duplicate capacity and cost and wide pricing differentials between spheres. What is yet unknown is the damage from the loss of global public goods. Thus, the reset of global rules will play a role in clarifying the boundaries separating the US-Western sphere and China-Russia spheres.

In this context, multilateral institutions and treaties are being sidelined as confrontations between the West and China-Russia intensifies. Russia or China are increasingly likely to defy Western rules and the West is increasingly likely to react aggressively. These great power conflicts cannot be resolved by rational justifications and fairness. Whales[32] like US and China generally throw their weight around to bully almost everyone else. Hence, the international order is degenerating into a muscular contest as the great powers dish out punitive actions ranging from tariffs, export controls, boycotts, disinformation campaigns, cyber-attacks, security investigations, sanctions and long-arm court litigation.

At the extreme, the West could be tempted to apply comprehensive sanctions on China. The consequences is likely to be painful – almost as bad as a war. Leaving aside the immediate supply shortages, it could lead to a blockade on global trading routes and airspace, followed by attempts to seize assets and disregard sovereign currencies and international property rights.

The reset of global rules is critical in determining the terms of co-existence among competing networks. The global reset will shape the new boundaries – how hard and extensive – the demarcations of the spheres of influence will be. It will specify inter-connectivity arrangements among competing networks and underpin the evolution of global arrangements for governance and safety (safe assets, neutral havens).

“Historically, world orders were primarily shaped by physical force – military, commercial and industrial. Post-WW2, the forces shaping the world order shifted from the physical to information. For several decades, the US emerged as the dominant superpower – with dominance in both the physical and information domains. They fostered a unipolar world order by building a coalition of nations that prospered under its umbrella. The unipolar order was remarkable in achieving consensus among friends and even enemies on the essential role of laws, the private sector and markets to build an advanced society. Convergence to this view fostered decades of relative stability, peace and confidence in global relationships. As barriers to flows fell, the diffusion of information, production and finance underpinned the spread of global prosperity. This distributed economic power which, in turn, undermined the stability of the unipolar world order. The Great Economic War (GEW) signals the global reset has begun – a transition from a stable unipolar world order towards an unstable multipolar world. Rising powers are demanding a greater voice. Rather than accommodate these demands, the US are leading allies to impose conditions to remain a member in the Western world order; and risking fragmentation by excluding non-compliant countries”. “The pillar of Western soft power was the primacy of Anglo-Saxon laws and judicial institutions in the liberal rule-based international order…developing countries accepted the Western-dominated legal order as a fair price of entry. In recent years though, the West has increasingly weaponised its laws[34] to achieve geopolitical goals. This was accompanied by the aggression of activists and courts eager to superimpose their values and reach across countries. In the meantime, developing countries had grown in economic stature and no longer appeared willing to subordinate their interests nor tolerate extraterritorial incursions into their jurisdictions”. The Western sanctions and asset seizures were imposed unilaterally on Russia “without regard to international laws. China and Russia have adopted a two-pronged response. First, they have filed lawsuits to challenge and test Western application of their laws. Second, they have weaponised their laws and legal systems to counter Western extraterritorial reach. Henceforth, lawfare is no longer one-directional – deployed by the West against developing countries – and major battles are expected to erupt in the legal realm”.

“There are several drivers of rising geopolitical conflict in the legal realm. First, the informationalisation of society has led to a massive expansion in rules; i.e. information overload tends to be accompanied by regulatory overload. New rules are required for the vast array of innovative and disruptive technologies (AI, IOT, blockchain, metaverse), products and industries (devices, drones, autonomous cars) and activities (sharing). While the scope for defining physical crime is limited (theft, murder), the scope for defining information misconduct appears limitless. Infringements and liabilities can be defined in relation to privacy, disclosure, usage, accountabilities, access, and ownership…Overall, this sharply increases compliance requirements, legal risks, potential liabilities and bureaucracy costs. The expansion of regulatory scope increases the likelihood of jurisdictional overlap and disputes at the international level. Second, information effects such as transparency, polarisation, santisation, complexity and convergence make for fractious societies. Knowledge and sophistication to game the legal system abounds. In the meantime, lawmakers, agencies and courts respond to public pressure by expanding their jurisdictional scope to cover a broad range of issues such as human rights, labour, climate change and national security and competitiveness…In an informationalised society, regulators and enforcers find it expedient to prosecute on information or procedural failures (tax evasion, omitting or providing false information, and failure to comply) than to prove actual wrong-doings. The penalties for information become onerous if the “wrong-doings” are linked to a serious crime like money laundering or national security. Third, rising lawfare can be viewed as an integral aspect of the broad backlash against globalisation, technology and MNCs. Implementation based on whole-of-government approaches means that laws are the main vehicle used to achieve populist, nationalistic and security objectives. National laws are now fashioned like missiles aimed at adversaries and their abettors”.

“Fourth, unsurprisingly rivals like Russia and China[35] have caught on, and now use law to justify their actions or counter-actions. Russia and China have recognised the importance of the rule of law but insist on sovereignty of their laws and courts. New centers for legal arbitration will likely emerge to compete with London and New York. An escalation in legal conflict is looming as the authority of US and European laws and courts are challenged by other countries. Five, laws and judgements may not be borderless but enforcement is. Cross-border enforcement will be a major area of conflict…In this context, if a country is excluded from a legal sphere, cross-border enforcement breaks down and, as more countries are involved, this will lead eventually to a breakdown in international governance arrangements”. “Sixth, lawfare shrinks international safe space and the supply of safe assets. The unilateral actions to freeze Russia’s assets and to block its physical, logistical, financial and information access to the West emphasises safety is now geopolitically conditional. This is problematic as laws work best when they are perceived to unconditionally and fairly protect property (i.e. patents, claims, agreements) and rights (i.e. governments, companies and individuals). The trend towards two-way lawfare – whether through vindictive sanctions, extraterritorial laws and court judgements based on national security concerns – undermines legal certainty and threatens the sanctity of international space and assets; including for third countries and MNCs”.

The trend towards lawfare has massive consequences. “In this regard, laws set legal boundaries and therefore defines the breadth and depth of fragmentation. Countries may choose to expand extraterritorial reach, withdraw recognition of some countries and associated legal rights, and erect barriers to cross-border flows (of goods, services, capital and information). A national approach to rule-making is likely to lead to clashes on international law and norms. Thus, lawfare will have a large role in scoping geopolitical spheres with the likelihood that access to information, rights and obligations, and legal reach may not be enforceable across different jurisdictions. As legal frameworks and jurisdictional interpretations diverge, as era of global litigative chaos lies ahead. The private sector would need to cope with different laws, standards and processes. Not only could laws be in conflict, but administration and court rulings could differ. It will cast doubt on the veracity of bilateral and multilateral treaties among governments. Fragmentation will undermine confidence in cross-border administration, enforcement and judicial decisions. Policy, compliance and legal uncertainties make it expensive, and sometimes even impossible for businesses to comply and this will feed into risk aversion. In the face of rising legal uncertainties and government interference, the private sector is likely to shift from formal or legal risk-taking towards informal or illicit activities. This is because there is more money to be made, on the margin, from arbitrage, smuggling, evasion, avoidance and piracy than there is from legal activities”.

“The geopolitical stakes would be raised if lawfare is used to formally extend claims on disputed territories, expropriate foreign assets or to target foreign governments and multilateral organisations. A total breakdown in the international legal system will have horrific consequences. Imagine the chaos. A multitude of legal actions freezing international relationships and activities. The invalidity of existing treaties and commercial agreements; non-recognition of ownership (including patents), creditworthiness (debt claims) and conflicting court rulings. The damage on the global economy will be immense. Non-recognition of each other’s legal jurisdictions is perhaps just one step away from triggering military confrontation. The existing global governance system will break down if superpower behaviour is no longer restrained by international rules or norms and  dispute resolution mechanisms are ignored or bypassed. The world will then revert to the law of the jungle, a world based on reciprocity, friendship and muscular strength. Without legal certainty, the world order will not be stable and it will definitely not be prosperous”.

  • Technology and data bifurcation, and the battle for resources

The biggest driver of geoeconomic fragmentation may not be trade tariffs but technology and data bifurcation. Reva Goujon argues “there are no small yards in regulating the digital economy. Internet of Things ecosystems rely on the interconnectivity of devices, people, and data flows, making virtually every node a potential risk vector. With the new US moves affecting a wide range of industries, from connected vehicles to biotech, companies will need to undergo a mindset shift toward more proactively assessing how their products, services, and data flows could pose national security risks to US critical infrastructure and US persons, and what mitigation measures to take – to include potentially unwinding relationships with Chinese partners and suppliers….national security concerns do not stop at human personal and military-related data. The US is also conditioning the facilitation of cross-border data flows on secure and trustworthy ICT systems at home and abroad”.

Reva Goujon points out the Commerce’s Information and Communications Technology and Services (ICTS) program provides “a diverse toolkit to regulate ICT infrastructure, as evidenced by a groundbreaking Commerce ICTS investigation into an entire class of technology-connected vehicles. The Commerce probe threatens to further splinter EV supply chains between in China, for China and China-free US markets. The probe also sets an important precedent for other connected systems to come under scrutiny, including agtech and biomanufacturing, autonomous and automated systems, large language AI models, and cloud-based computing”. In addition, “there is strong potential for extraterritorial US ICT measures given the inherent interconnectivity of ICT systems across borders and how the US is framing a theory of harm around the risk of Chinese OEMs and suppliers being co-opted by the Chinese government to enable malicious cyber activity. Cracking down on sensitive bulk data transfers via third parties may also lead the US to cover more of the map, similar to the design of US export controls on semiconductors and advanced computing”.

Reva Goujon adds the Biden administration are running surgical strikes with new US data security measures that focuses on personal data genomic data, biometric data, personal health data, geolocation data, financial data, and certain kinds of personal identifiers. The ICTS investigation by Commerce focuses on transactions relating to the ICT supply chain for connected vehicles alongside a Commerce ICTS investigation into connected vehicles. This is having an impact on Chinese firms like BGI (genomic sequencing), Wuxi AppTec, Wuxi Biologics (contract research), and TikTok, Temu and Shein (social media and e-commerce platforms). “The concern is not merely theoretical. A recent CISA/NSA/FBI report documented how China-backed hacking group Volt Typhoon has been exploiting vulnerabilities in routers, firewalls, and VPNs to target water, transportation, energy, and communications systems across the US. The report details how a malicious actor can move laterally across systems once they gain entry, putting the broader network at risk, and suggests that such operations pre-position malicious cyber actors to conduct destabilizing attacks on US critical infrastructure in a geopolitical conflict scenario. These concerns are a big driver behind another recent Executive Order and $20 billion investment through grants focused on replacing Chinese-made port crane infrastructure”. “Learning from the messy Huawei and ZTE 5G unwinding, the US has been more proactive in blocking Chinese companies from international subsea cable projects involving US funding”[36]. “If the theory of harm is that a Chinese supplier can be co-opted by the Chinese government to install backdoors for malicious cyber activity, then broader restrictions could follow with the intent of getting US auto OEMs and suppliers to unwind their partnerships and supply agreements with Chinese entities. Covered technologies could include sensors and microcontrollers, in-car software, internet modules, and even battery systems”

Reva Goujon argues “this sets the stage for potential extraterritorial measures if the US deems that Chinese ICT suppliers are a liability for connected vehicles in the US, regardless of where the manufacturing of those inputs is taking place, whether in China or fast-growing EV manufacturing hubs in Germany, Mexico, Thailand, and Brazil, where Chinese EV makers have been investing heavily…If US ICT restrictions are limited to connected vehicles deployed in the US, then will auto OEMs and their suppliers be forced to bifurcate supply chains into China-free manufacturing for the US and in China, for China” operations?” In addition, there are intentions “to assess spillover effects of removing Chinese ICT suppliers and to identify non-Chinese suppliers to replace them. The implication is that market opportunities can expand for companies that can position themselves as compliant and China-free suppliers for the US and partner markets. This is where industrial policy incentives, trade defense, cybersecurity, and data security intertwine…Even as economic security measures threaten to raise input costs, industrial policy incentives (like IRA tax credits that are designed to extricate Chinese inputs) combined with trade defense (like higher tariffs on Chinese-made EVs) aim to level the playing field and boost US competitiveness in markets where Chinese firms are being denied access. Industry groups like the Alliance for American Manufacturing are already explicitly advocating for “exclusionary” tariffs to fend off Chinese EV competition. Amid long-running trade disputes, ICT cybersecurity restrictions could be the more efficient means of barring Chinese EVs from the US market. The potential for long-arm application of US ICT measures will be top of mind for many countries and companies who will have to contemplate whether it will be worth trying to align with US standards for what constitutes safe and trustworthy ICT networks. The potential cost? Loss of access to the US market in emerging technology spaces. Not to mention the potential for the US to leverage its security and intelligence ties in making the case that such cooperation can only endure if cross-border data flows and ICT networks are secure”. “Connected vehicles is the first investigation, but it won’t be the last. Other potential areas for scrutiny include ICTS products and services integral to biomanufacturing, agtech, autonomous or unmanned systems, artificial intelligence and machine learning, e-commerce, and cloud-based computing and storage”.

The US challenge is to bring its allies along its efforts to align and enforce its data and ICT standards against China. Reva Goujon notes “the economic security climate has evolved considerably since the early days of the Trump administration’s diplomatic crusade to purge 5G networks of Huawei. The European Commission published a review of its 5G Toolbox last June, saying that only 10 of the EU’s 27 member states had taken steps to restrict the use of high-risk vendors in their 5G networks, and has tied EU funding of 5G rollouts to whether member states bar Huawei and ZTE. The EU is also actively deploying trade defense measures targeting China, including an ongoing probe into Chinese EV imports. For companies that are already deeply integrated in Chinese EV supplier networks, the US ICT investigation should serve as another wake-up call to potential regulatory entanglements creeping closer to home…With the US finally leaning in on data security measures, there is greater potential for credible G7 alignment on data security norms – an objective long held by Japan in promoting its Data Free Flow with Trust The implication? An emerging trade bloc of countries bound by common data security standards would de facto exclude China and reward countries that align with the G7 standard”.

Recently, US and EU stepped up their actions. Alan Wm. Wolff details unprecedented actions on Chinese entities like Tik Tok (potential misuse of business data and personal information) and Nuctech (government subsidies) by US and EU which are potentially reshaping their long-accepted norms in dealing with international trade and investment.

In addition, there are also collaboration to strengthen the position of allies. Sujai Shivakumar, Charles Wessner and Thomas Howell notes Japan – whose share of world semiconductor production fell from over 50% at the end of 1980s to 9% in 2022 and whose industry “lags behind the global technological leaders by an estimated 10 years” – is seeking to restore the international competitiveness of its semiconductor industry and “to build a global supply chain in collaboration with the United States and Europe – one which is less vulnerable to shocks such as those which occurred during the pandemic and less dependent on an increasingly assertive China”.

China has long fortified its internet and data ecosystem. Rebecca Arcesati, Kai von Carnap, Antonia Hmaidi and Jeroen Groenewegen-Lau review “barriers Beijing is creating in its pursuit of making the internet secure and controllable” and analyze how fragmentation plays out across the different components of China’s internet…data flows, web applications, internet protocols and digital hardware as a representative cross-section of internet infrastructure”.

Given current trends, China appears resigned to going-it-alone to pursue self-sufficiency to reduce the criticality of US technology chokeholds. Antonia Hmaidi; and also Gregory C. Allen reviews the role of Huawei in strengthening the independence of China’s semiconductor supply chain. In this regard, the advantage of US controls[37] is transient as technology becomes obsolete quickly and can be easily by-passed or leapfrogged in peer-to-peer and IOT networks.

The endgame is becoming visible[38]. Rules on technology and data will play a key role in geoeconomic fragmentation. The battle over semiconductors will likely make its way downstream into hard and soft products; reinforced by diverging technology standards and rules on data sovereignty and privacy. The battle will intensify over markets in the Global South. The West will attempt to neutralise the influence of BRI in deepening China’s bilateral relationships. For example, the US has put pressure on Middle East countries to terminate or restrict their technology ventures with China.

A critical battle has also started over minerals. Ryan C. Berg, Henry Ziemer and Emiliano Polo Anaya notes “China’s state-sponsored industrial policies, financing, and tax incentives have led to considerable political leverage worldwide over the raw materials required for semiconductor manufacturing; the country has positioned itself as the dominant supplier of raw material inputs for cutting-edge technology…China’s concentration – bordering on monopoly – of supply and production of critical minerals creates a vulnerability, leaving the industry exposed to supply chain disruptions. The International Energy Agency claims that China maintains 60 percent of the world’s rare earth mining production and approximately 90 percent of processing and refining. The West’s reliance on China’s minerals poses worrisome risks of supply shocks and China exercising its leverage over prices. A secure supply of critical minerals for the semiconductor industry is not only necessary for the private sector but also a concern for national security and defense; since 2020, the United States has recognized it has no domestic production of 14 of the minerals on the critical minerals list and is completely dependent on imports to supply its demand”. “As a direct response to U.S. export controls, the PRC has leveraged its dominance in the early stages of supply chains to restrict exports of gallium, germanium, and graphite…In July 2023, alleging national security concerns…took the form of licensing requirements that mandate exporters first apply for permission from the Chinese Ministry of Commerce…the PRC has seemingly not sought to choke off U.S. access to the metal completely, taking a presumption of approval approach to licensing exports. However, concerns persist that this could rapidly switch to a presumption of denial for gallium and a host of other minerals and technologies”.

Ryan C. Berg, Henry Ziemer and Emiliano Polo Anaya point out “China’s privileged position in the semiconductor minerals supply chain is due not to its innate resource wealth but to its dominance in the realm of smelting, refining, and processing”. “In addition to these ideological and political obstacles, the mining sector and the redrawing of supply chains have generated concern about local environmental impacts. These industries are not only highly polluting, they also require large amounts of other resources such as water and electricity”. Nonetheless, “a future U.S. strategy should emphasize multilateral coordination to friend-shore processing capacity, substitute critical mineral suppliers, stockpile for both defense and economic security needs, and survey for new and untapped sources of semiconductor-critical minerals…Bringing processing capabilities back to the Western Hemisphere therefore promises not only to help counteract China’s influence over semiconductor supply chains but also to allow Latin American countries to advance in the value-added manufacturing space”.

In the meantime, Lu Yutong, Luo Guoping, Shi Yimin and Denise Jia note “China has listed 24 strategic minerals in the National Mineral Resources Plan published in 2016…as critical to safeguard national economic security, national defense security and the development of strategic emerging industries. They include energy resources such as oil, natural gas, shale gas and coal, as well as the metals iron, copper, aluminum, gold, nickel, cobalt, lithium and rare earth elements. Minerals including phosphorus and potash are also on the list”. They highlighted that “China lacks sufficient reserves of strategic minerals. The country’s strategic mineral reserves, including iron, copper, aluminium, nickel and lithium, equals less than 20% of the world’s total, while the country accounts for more than half of global consumption of cobalt, aluminium and copper. China uses 40% to 50% of all nickel, iron, graphite, lithium and 11 other minerals consumed in the world”.

The US is starting to pry China’s grip on mineral resources[39] in the West as well as in Africa and Latin America. Lu Yutong, Luo Guoping, Shi Yimin and Denise Jia notes “Western countries, led by the Five Eyes alliance of the US, the UK, Canada, Australia and New Zealand, have adopted policies to tighten foreign acquisitions of key mineral assets in their countries while supporting local industries”. “Subsequently, the White House ordered a review to assess supply chain vulnerabilities across four sectors, including for vital materials. Australia and Canada followed suit. The Canadian government in November ordered certain Chinese companies to divest their interests in three Canadian mining companies, citing national security. Sinomine (Hong Kong) Rare Metals Resources Co. Ltd. was told to sell its investment in Power Metals Corp.; Chengze Lithium International Ltd., also based in Hong Kong, was compelled to divest its investment in Lithium Chile Inc.; and Zangge Mining Investment (Chengdu) Co. Ltd. was required to exit Ultra Lithium Inc”. Daniel van Dalen reports on how US is challenging China’s access to key metals such as cobalt, lithium, copper and coltan in the Democratic Republic of the Congo. Lu Yutong and Wang Xintong notes “in parts of Latin America, Africa and Southeast Asia, governments are restricting or even banning the export of certain raw minerals used to make EV batteries, including lithium, copper and nickel. This approach, which effectively requires miners to build processing plants locally, is reshaping supply chains that underpin the shift toward clean energy. Similar to Chile, Mexico is also seeking greater state control over its lithium reserves, taking steps that include passing a bill in 2022 to nationalise the mining and extraction of the light metal. Chile had taken back control of copper mines from foreign companies in the past”.

Global reset of institutions and rules for a multipolar world

The existing global governance framework is no longer tenable with the world looking to fragment into separate spheres or competitive networks. However, a complete break does not seem to be a realistic proposition. “It is not possible to completely eliminate cross-border interactions in a modern information-based global economy because it is highly interdependent and reliant on global public goods. Powerful countries need to achieve mutual understanding to accommodate each other’s jurisdictional rights and to resolve international disputes. A new legal model to reset the rules of the global game is critical to prevent lawfare from degenerating into a free-for-all that could tip the world into a destructive military confrontation”[40].

It is not possible to stabilise the world order in a multipolar landscape without great power consensus on universal ideals, generic principles and global governance arrangements that ensure independent oversight and dispute resolution processes. Initial agreement between US and China would go a long way to initiate the process of reviewing and remaking global institutions and rules to cater for the shift from a unipolar to a multipolar regime. The follow-up could be in a multilateral setting – with the UN or G20 as the most convenient forums.

The three critical areas for a global reset are:

  • Reshaping of global institutions and rules. Most agree multilateral organisations such as UN, WTO and IMF are in urgent need of reform to reflect changing global structures. The key issues revolve around veto and voting rights. The reform of rules should also reflect a recalibration of the balance between global and national objectives such as sovereignty and security. There is a need to re-tier countries according to their level of development and size and to re-assess privileges to promote a more level playing field. There is a need for updated guidance on sanctions and subsidies as this will lay the groundwork to reset the rules on global trade and finance. But there doesn’t seem to be any traction for such reform.
  • Reset rules to minimise military conflict. The next six years are crucial to establish mutually agreed principles for security and a code of conduct in conflict zones. New guardrails should be established to limit foreign military interventions, the speed and scale of the arms race and to specify war crimes and the penalties to be applied. Priority should be given to establish programs for conflict prevention and de-escalation backed by an increase in the budget for initiatives to promote peace and international cooperation.
  • Review rules for interoperability, international law and safe havens. There is a need to clear the uncertainty over rules governing connectivity – data, trade, capital flows and legal jurisdiction – particularly between adversarial countries. In particular, there is a need to designate safe assets and space where rights are guaranteed by all countries.


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[1] See Office of the Director of National Intelligence assessment of the China threat.

[2] Attributed to Deng Xiaoping.

[3] The “century of humiliation” is used to describe the period in Chinese history beginning with the First Opium War (1839–1842) typified by the decline, defeat and political fragmentation of the Qing dynasty which led to demoralizing foreign intervention, annexation and subjugation of China by Western powers, Russia, and Japan.

[4] See Anthony H. Cordesman for a US perspective on the range of major threats to global stability, including both civil and military threats.

[5] See Chen Qingqing.

[6] See Jeongmin Seong, Chris Bradley, Nick Leung, Lola Woetzel, Kweilin Ellingrud, Gautam Kumra, and Peixi Wang on economic trends for the Asian century.


[8] See Ben Norton.

[9] “The Great Economic War (GEW) (Part 12: Geopolitical Go)”.

[10] See Jon B. Alterman on “China and the Middle East”.

[11] See Pepe Escobar.

[12] See Jodie Keane on how the new EU rules environmental rules threaten to hurt the world’s poorest nations.

[13] See Uwe Parpart and David P. Goldman.

[14] See Joshua Bowes on how the Digital Silk Road is enabling China to challenge India’s influence in the Indian Ocean region.

[15] See Huang Lanlan and Leng Shumei.

[16] The G7 share of global GDP peaked at 66.9% in 1992 and has since fallen to 43.4% in 2022.

[17] See China’s proposals for “A global community of shared future”.

[18] See “The Great Economic War (GEW) (Part 14: The middle game – Instability and reset of world order and global governance)”.

[19] See Daniel Araya.

[20]   See “The Great Economic War (GEW) (Part 14: The middle game – Instability and reset of world order and global governance)”. See also reports by Tong Zhao and Dmitry Stefanovich; Anthony H. Cordesman; Mark Cozad, Jeffrey Engstrom, Scott W. Harold, Timothy R. Heath, Sale Lilly, Edmund J. Burke, Julia Brackup and Derek Grossman

[21]   See “The Great Economic War (GEW) (Part 14: The middle game – Instability and reset of world order and global governance)”.

[22] See Xinhua for China’s Global Security Initiative concept paper.

[23] See Simplicius The Thinker’s review of West Point think-tank’s analysis of Russia’s military evolution.

[24] See People’s Republic of China office stance on Taiwan reunification.

[25] Benjamin Jensen, Riley McCabe and Adrian Bogart; Bonny Lin, Brian Hart, Matthew P. Funaiole, Samantha Lu and Truly Tinsley; Chen Feng; Koichiro Takagi; Lonnie D. Henley; and Robert Evan Elli on Taiwan invasion, blockade and quarantine scenarios.

[26] See Anthony H. Cordesman and Paul Cormarie on non-military conflict; Richard W. Maass on Salami tactics; National Defense University on Chinese concepts of “strategic deterrence”; Seth G. Jones, Emily Harding, Catrina Doxsee, Jake Harrington, and Riley McCabe on China’s strategy of political warfare.

[27] See Olesya Shmagun on how Russian citizens are still able to easily purchase Western products.

[28] “The Great Economic War (GEW) (Part 2: Strategic concepts and implications)”.

[29] See “Global reset – Two whales in a pond”; “Theories on war and diplomacy (Part 3: Conflict in the information realm)”.

[30] “The Great Economic War (GEW) (Part 2: Strategic concepts and implications)”.

[31] See Ketian Vivian Zhang on China’s use of ambiguous actions.

[32] See “Two whales in a pond”.

[33] This section is mainly drawn from “The Great Economic War (GEW) (Part 8: Lawfare)”.

[34] See PRC Ministry of Foreign Affairs’ critiques of US hegemonic practices and use of long-arm jurisdiction.

[35] Alena F. Douhan provides a legal and humanitarian overview on unilateral coercive measures; Chen Qingqing highlights a Chinese report on US long-arm jurisdiction; separately Francesca Ghiretti, Isaac Kardon, Chen Qingqing and Xing Xiaojing provide perspectives on China’s approach on imposing sanctions and expanding its international legal reach.

[36] See Elina Noor and also Reuters for analysis of geopolitics of undersea cables in Asia-Pacific; and Dale Aluf on Middle East and North Africa.

[37] William Alan Reinsch, Thibault Denamiel and Eric Meyers provide an overview of US export controls.

[38] “The Great Economic War (GEW) (Part 10: The semiconductor technology battlefront)”.

[39] See Simon P. Michaux analysis of Chinese corporate investments in minerals around the world.

[40] This section is mainly drawn from “The Great Economic War (GEW) (Part 8: Lawfare)”.