After the protracted COVID-19 pandemic and Western sanctions against Russia and China, which demonstrated the fragility and instability of global supply chains, and the military conflict in Ukraine, which broke economic ties between Moscow and the West and undermined global energy and food markets, the world has come to another tipping point, namely, as many in the international expert community believe, a slowdown in globalization.
For decades, the free flow of trade in much of the world allowed the richest countries of the West the easy access to cheap commodities and materials. This system guaranteed prosperous economies and stable markets, and ultra-low inflation for U.S. and EU households and companies. Western companies moved production to China and other developing countries to gain access to low-wage labor. Now the new order that has emerged puts multinational corporations in a difficult position: their attempts to maintain low costs and high profits in the context of the termination of economic ties with Russia and the imposition of trade sanctions on the PRC make it impossible.
This brings to an end an era when countries with different political and ideological systems could trade and mutually benefit from integration processes in the global economy. In May 2022, at the World Economic Forum in Davos, Kristalina Georgieva, Managing Director of the International Monetary Fund, warned of impending “geoeconomic fragmentation”. According to her, countries and companies reconsider global supply chains and nullify gains of decades of integration.
Apparently, the world is now experiencing not the end of economic integration, but a geopolitical recession, characterized above all by a slowdown in the entire process of globalization. Thus, the era of “hyperglobalization”, which lasted from the end of the last century until the 2008 financial crisis, with the United States leading and directing trade liberalization and global integration “from the top down”, has indeed come to an end. At the same time, the ideological approaches that promoted it and the unipolar international order that sustained it have changed.
Washington, which is increasingly forced to deal with domestic socio-economic and inter-party problems, no longer has sufficient political will and financial and economic resources to serve as a kind of architect and guarantor of the world economy. The Americans have probably reached the limit of their ability to advocate a unipolar approach in the world economy and are approaching this frontier in foreign policy. Meanwhile, Beijing, faced with serious structural economic problems, is also not yet ready to advance its world order with greater access to trade and investment policies. This leadership vacuum in the global economy has led, according to former World Bank President Robert Zoellick, to a weakening of the “governance of globalization”. The global economic order has become increasingly multipolar and fragmented in the absence of international leadership, which also indicates the changing nature of the globalization process. At the same time, globalization itself, with all its shortcomings and disadvantages, still meets the interests of most countries and does not yet have a decent alternative.
All of these global trends were clearly revealed at the G20 summit in Bali, Indonesia, in November 2022, which took place under the theme: “Recover together faster!” Instead of striving for unity, the summit was dominated by a movement to divide the G20 participants “10 by 10”, with the first half representing the collective West led by the United States and the other half represented by countries outside the Western bloc seeking to strengthen their sovereignty by protecting their national interests. Five of the ten, China, Russia, India, South Africa and Brazil, represent the BRICS, while five others, Saudi Arabia, Argentina, Turkey, Mexico and Indonesia, aspire to join the bloc.
This meeting demonstrated the failure of all efforts by the Americans and their satellites to exclude Russia from the G20, since it was not approved by the majority of G20 leaders. Moreover, the summit confirmed that Russia is open to all nations, especially now when the world is changing and the center of power is shifting from the collective West to the countries opposing it. The U.S. failed to conclude the leaders’ meeting with a unanimously supported anti-Russian final declaration that would have found Moscow guilty of the military conflict in Ukraine. According to the U.S. publication Bloomberg, President Biden’s talks with Chinese President Xi Jinping ended in failure, after which tensions between the two powers escalated not only because of continuing disagreements over trade policy, access to markets in the two countries and Beijing’s actions toward Taiwan and Hong Kong, but also because the Chinese leader refused to condemn the Russian military operation in Ukraine. Not surprisingly, by reinforcing the confrontational line, the Americans are purposefully striving, among other things, to weaken their partners, most of whom are already politically subordinated to them in the framework of the so-called “Atlantic solidarity”. A disturbing trend has been the lack of meaningful participation in the summit of European elites due to the lack of political will. They still adhere to the stereotypes of classical globalization based on liberalism, as well as their inability to get out of the confrontation with Russia, not conditioned by real economic priorities.
Having failed last November at the Bali G20 forum, the West did not abandon its attempts to impose the “Ukrainian crisis” topic at the meetings of finance ministers and central bankers in Bangalore in late February this year and G20 foreign ministers in Delhi and once again disrupted the adoption of a general communiqué at the end of both meetings in India. Commenting on the meeting of the G20 Foreign Ministers on the eve of the G20 Summit to be held in September in the Indian capital, Indian Foreign Minister Subramanjan Jaishankar pointed to the highly politicized nature of the participants’ views on major issues on the global agenda, which, in his opinion, threaten to paralyze one of the few international institutions that still retain the potential for meaningful dialogue and productive interaction.
For his part, Indian Prime Minister Narendra Modi expressed the following wish for the G20 participants of foreign ministers meeting: “We should not allow issues that we cannot resolve together to come in the way of those we can. The world looks upon the G20 to ease the challenges of growth, development, economic resilience, disaster resilience, financial stability, transnational crime, corruption, terrorism, and food and energy security”.
At the same time, more and more leaders of the “Global South” come to the understanding that the continued destructive policy of the United States and its allies in world politics and economics can make the G20 ineffective and prompt the search for alternative international venues, And the possibility of creating a bloc of “non-Western” countries similar to the G20, including various countries from Iran and Saudi Arabia to such states as the United Arab Emirates, Thailand, Algeria, Egypt, Pakistan and Nigeria, seeking to strengthen their foreign policy course. At the same time, the realization of the G20’s uselessness in its current state, in terms of stabilizing the global economy, for which it was created, may intensify the process of forming a collective non-Western world and thus create conditions for moving towards a binary world system.