The Changing Face of Globalization

22 January 2016

What impact will globalization have over the next twenty years? According to Mathew Burrows and Alexander Dynkin, it will inevitably create a new international order. In today’s extract, they speculate on how violence in its various guises may define this order for both good and ill. 

By Mathew J Burrows and Alexander A Dynkin for Atlantic Council 

The following extract is from [A] Global System on the Brink: Pathways towards a New Normal, a report which the Atlantic Council published on 2 December 2015.

The character of globalization is changing, creating a more volatile global environment with increasing gaps between the core and periphery of the world economy. The loss of national sovereignty is a growing battle cry for those opposed to globalization. Globalization is no longer equivalent to Westernization; instead, it is occurring on terms set by non-Western cultures, as wealth and technology spreads to the east and the south. Globalization has reduced inequalities between developed and developing economies, but it has deepened economic differences domestically in practically all countries. Anti-immigrant sentiment is rising at a time of increasing job insecurity. The sources of instability are not just on the surface between nations, but are deeply rooted in cultures and societies undergoing immense unraveling. Financial crises can’t be ruled out even if the more polycentric financial system becomes more stable. The governance deficit—the absence and ability of any regulatory body to control market forces—is seen as a universal problem in both advanced and fledgling countries. 

Governmental power is becoming more diffuse. The nation- state system is challenged from above by globalization and from below by ethno-nationalism and individual empowerment, which will remain potent forces through to the year 2035. The instant, 24/7 access to information has sparked a “global awakening” in expectations—seen dramatically but briefly across the Middle East with the 2011 Arab Spring—and local, traditional sources of identity have become reinvigorated. Forces of fragmentation are evident worldwide in secessionist efforts from Scotland and Catalonia in Europe to South Sudan in East Africa. The future of the Arab state system in the Middle East is in doubt. Anti-globalization stirrings by themselves won’t stop globalization, but they will undermine trust in governance at all levels, from local to global.

Demographic trends—rapid aging, greater urbanization, and increased mobility and migration—will continue to compound the difficulties of governing. Many governments will struggle to temper “demography as destiny” if aging causes an economic slowdown, and rapid urbanization and increased migration intensify public discontent.

Despite the promise of cooperation and integration emanating from the rapid globalization of the past few decades, the potential for major state conflict is growing because of deep fragmentation within and between societies. The old confrontation between capitalism and communism has given way to nationalism and conflicts of intellectual and moral values with more or less religious and historical-psychological overtones. These differences are even more serious when linked to the domestic political interests of particular countries’ ruling circles.

Compared to the last twenty years, the big powers will be more likely to get involved in various conflicts and to take opposing sides in the period of 2015-35. They might be unintentionally drawn into direct armed conflict as a result of an escalation of crises. This risk applies most immediately to the differences between Russia, the Shanghai Cooperation Organization (SCO), and the United States/NATO in the post-Soviet space, and, less likely, to Chinese and US relations with both countries’ allies and partners in Asia. The growing turbulence in the Middle East and, to a lesser extent, South and East Asia sets the stage for conflict between the major powers and a potential breakdown of the world order. A conflict involving the great powers would end the already challenged ideal of an inclusive liberal world order and put the global economy at risk.

The ongoing crisis in Russia’s relations with the US and the European Union (EU) starting in 2013-15 shows that economic interests and cooperation in international security can be sacrificed for the sake of political, geopolitical, and ideological ambition. The current confrontation differs considerably from that of the mid1960s to mid-1980s, in second half of the Cold War era, when tacit “untouchable” geopolitical spheres of influence were clearly delineated, and other zones were not worth the risk of a direct military conflict. The situation through 2035 will also be far different from that of the first twenty-five years following the end of the Cold War, when the big powers avoided serious differences, often because Russia and China acquiesced to Western leadership.

Worst-Case Outcomes

The worst outcome would be a new bipolarity with the emergence of a grouping around Russia and China facing a United States with some European and Asian allies. A somewhat less dangerous outcome would be the breakup in regional blocs and spheres of influence in which the potential for greater ad hoc global cooperation would still exist but is not guaranteed. A remote possibility would be a return to a more inclusive, integrated world order, in which interstate competition was kept in check and in which there was more scope for cooperation. 

For both the United States and Russia, a new global bipolarity or possible breakup of the world into regional blocs would create new challenges. US capacity would be stretched to the breaking point if tensions with Russia and China escalate at a time of increased security concerns in the Middle East. The breakup into regional blocs and spheres of influence would increase the number of players with divergent interests, making it more difficult to sustain a global coalition on challenges like counterterrorism and nonproliferation. In a new bipolar system, Russia would end up not only in confrontation with the West, but it also could be drawn into conflicts in which it originally had no part. In a regional blocs scenario, if Russia’s relations with the West deteriorated even further, that would inevitably poison China’s and India’s relations with the Western bloc and strengthen the SCO. After its enlargement in 2015, it has increased its institutionalization substantially and already comprises four nuclear states.

Number of Regions Ripe for Conflict. Practically any part of the post-Soviet space and surrounding regions, the western part of the Asia-Pacific region, the Middle East, and the northern part of the Indian Ocean could become the site of serious competition between major powers. The increasing range and reduced response time of current and emerging non-nuclear offensive weapons systems and their highly automated command-and-control systems heighten the risks of accidental or provoked military incidents and rapid escalation of armed conflict. 

If Ukraine continues to disintegrate and Russia becomes more-heavily involved, NATO, the United States, or a “coalition of the willing” might engage in direct military intervention, resulting in head-on conflict. If Moscow faces the possibility of a crushing defeat, it might perceive that such a conflict would, as Russia’s new military doctrine states, “constitute a threat to [Russia’s] statehood” and force Russia to use nuclear weapons. Even without going to such extremes, actions by the Russian and NATO navies and air forces in the Black and Baltic Seas today have raised the risk of military incidents leading to armed conflict. The threat of such crises will grow if relations with the West become confrontational and East-West tensions increase.

In the Middle East, surrounding countries and regions— such as Turkey, Egypt, and Europe—are increasingly focused on domestic issues. With less US engagement in the region, sectarian conflicts between Sunnis and Shias and between Kurds and Arabs could worsen, eventually sparking a major conflict in the region. A “cold war” between Saudi Arabia and Iran is already under way, and a “hot” regional conflict is occurring in Yemen. Pro-Iranian Houthis, as a branch of Shia, are fighting Yemeni Sunnis supported by Saudi Arabia and its Sunni allies, including the United Arab Emirates (UAE) and Egypt. The Middle East is a platform for increasing tensions between the United States and its partners against Russia, Iran, and others who want to bolster Syrian leader Bashar al-Assad.

In East Asia, China has been undertaking a massive buildup of its conventional forces, in particular its navy, which occurs against a backdrop of a shift in the nuclear balance of power in China’s favor. The reach of China’s navy will cover the entire region in which US allies and partners are located (Japan, Malaysia, the Philippines, Singapore, South Korea, Taiwan, Thailand, and Vietnam), reflecting Beijing’s growing geopolitical ambitions in its neighboring seas.

If China engages in military and political expansion in the western part of the Pacific Ocean and in the Indian Ocean, a new bipolarity could develop. Such a system would include, on the one hand, a loose group centered around China and Russia, including some Collective Security Treaty Organization (CSTO) members of Central Asia, North Korea, Iran, and probably others depending on circumstances, and, on the other hand, an alliance centered around the United States, including US allies in Europe and Asia. 

Likelihood of Nuclear War Increasing. As geopolitical tensions increase, the likelihood of conflicts spilling over into regional nuclear war between second-tier nuclear powers will also increase. Worsening relations between India and Pakistan pose the biggest risk of this kind. Pakistan, which has no clearly formulated nuclear doctrine, heavily relies on the principle of making a first nuclear strike; India, on the other hand, has pledged a no-first-use nuclear policy. A flare-up in Pakistan’s domestic political situation and the threat of Islamic radicals (the Taliban) and international terrorists (al-Qaeda) getting their hands on nuclear weapons might also lead to conflict. 

A premeditated nuclear attack by North Korea against South Korea or the United States (Pyongyang is projected to develop intercontinental ballistic missile capability in the next ten to fifteen years) is unlikely. However, periodic attempts by North Korea to increase tensions could provoke an armed conflict. If the North Korean regime were to find itself facing defeat, it might resort to using nuclear weapons. In such a situation, the United States might decide to launch a pre-emptive strike using high-precision conventional weapons; Pyongyang would probably respond by using its surviving nuclear arms.

A conflict between India and China is much less likely during the next twenty years than a conflict between India and Pakistan. China would be unlikely to use nuclear weapons even if a war between India and Pakistan turned nuclear. At the same time, tensions in the Indian Ocean will probably increase and might provoke a number of armed clashes, though these would not turn nuclear. 

During the next twenty years, Israel or Iran could fight an interstate conflict if either side violates the comprehensive agreement of July 2015, regarding the limitation and transparency of the program or the lifting of sanctions. If such a conflict occurs, it would be quasi-nuclear—it would not involve the actual use of nuclear weapons, but rather the use of force to prevent their development and proliferation. The current agreement is only slated to last ten to fifteen years, opening up the potential for another confrontation if Iran does not extend its renunciation of nuclear weapons.

War, especially if the United States gets involved on Israel’s side, would risk destabilizing nuclear Pakistan and setting off a rapid upsurge in Islamic radicalism around the world. It could also push the Arab and Muslim countries into a large-scale departure from the Nuclear Nonproliferation Treaty (NPT) and encourage some countries to step up their own military nuclear programs with the aim of acquiring nuclear deterrent capability against the United States and Israel. 

This would irreversibly undermine the legal foundations of the nuclear nonproliferation regime. The Iranian nuclear agreement paves the way for new opportunities to strengthen the nuclear nonproliferation regime and the controls over critical technology and materials through cooperation between big powers and regional players.

Growing Regionalized Conflict. The risk of conflict will increase during the next twenty years, even if the big powers do not get directly involved. Such conflicts will not necessarily escalate to include the use of nuclear weapons. This applies above all to the Middle East and neighboring regions, with the possibility that conflict areas could merge to form one large zone from Morocco to the Hindu Kush, also drawing in Afghanistan, Pakistan, Central Asia, and Iran (if a military strike is launched against its nuclear infrastructure).

The risk of armed Islamic extremism in the region (this is an issue that is simultaneously domestic, transnational, and transregional in nature) remains the most serious threat to international security. Islamic armed extremism could take the form of attacks on secular pro-Western and anti-Western state regimes; conflict between Sunnis and Shias; and an increase in piracy in the Mediterranean and Red seas, around the entire African coast, and in the northern Indian Ocean and western Pacific Ocean. 

Other regions where conflict could spread include Central and Southeast Asia and also equatorial Africa, where a growing number of countries could be drawn into conflict between Muslim and Christian populations, providing fertile ground for further expansion of terrorism.

Nature and Types of Conflict. The likelihood of a major war between the main power centers will increase relatively, but will still be lower than it was during the first part of the Cold War (1947-62). Hybrid wars, selective military operations, long-range precision strikes (non-contact wars), the use of small mobile units in special operations (rapid power), communication disruptions,and blockades will play bigger roles in the use of military power. Such means will not be used to achieve victory over the enemy, but to reach limited objectives. These objectives include changing the country’s regime or subjugating a state through direct external threats to its territorial integrity or violating territorial integrity by engaging local armed opposition groups. 

The major powers and their allies are unlikely to engage in conflict with each other over energy and other natural resources (including fresh water), Arctic transport routes, and territories and key geographic nodes abroad. The damage and consequences of any large-scale conflict for the interdependent big powers would be far greater than the hypothetical advantages to solving disputes through military means. However, large-scale military deployments and an intensive arms race to gain control over the above assets would forge predominantly confrontational relations among the principal international players.

Opportunities

Despite the growing risk of conflict, the number of military operations under United Nations (UN) aegis to impose or maintain peace or to prevent genocide, ethnic cleansing, and humanitarian emergencies—and perhaps also to prevent technological disasters and to protect the environment—could increase. States no longer have the monopoly on killing or disruption on a large scale. The next fifteen to twenty years will see a wider spectrum of more accessible instruments of war, especially precision-strike capabilities, cyber instruments, and bioterror weaponry potentially being used by international terrorist and transnational criminal organizations. Concomitantly, the number of operations by states to combat them is likely to increase.

The major powers and the main regional players could also collectively use force to prevent the proliferation of nuclear weapons and cut off terrorists’ access to them. Operations of this kind on a multilateral basis or under the mandate of the UN and/or regional security operations might occur more frequently during the next twenty years.

Arms Control. For France, Russia, China, and India, the nuclear deterrent could play a less important role in guaranteeing security than it does today, if geopolitical competition decreases. If geopolitical competition increases, there will be much weaker incentives for movement toward nuclear disarmament. The emphasis will shift to cutting-edge, high-precision, long-range offensive and defensive weapons as well as non-nuclear deterrent concepts. In a more competitive security environment, nuclear weapons would play a greater role in military- political relations between the big players and smaller nuclear powers, as well as between the new nuclear and threshold countries.

If—with the help of Russia, the United States, and China— India and Pakistan can avoid nuclear conflict, New Delhi and Islamabad could conclude a nuclear arms limitation treaty during the 2020s. In the context of general security and political and military stabilization in the Middle East and strengthening the nuclear nonproliferation regime (particularly pertaining to Iran’s nuclear program), Israel could end the use of operationally deployed nuclear weapons by 2035 (following the South African example).

Israel would keep the weapons-grade material in storage under the International Atomic Energy Agency safeguards but dismantle the explosive devices. During the next twenty years, North Korea’s political and economic system could collapse and be united with the South, likely resulting in a unified Korea that renounces nuclear weapons.

China might play a greater role in nuclear and other arms control efforts, probably working bilaterally with the United States. Greater Chinese involvement in nuclear and advanced conventional arms control efforts could be motivated by China’s desire to take Russia’s place as the second superpower, a status traditionally associated with the privileged role of the counterpart in strategic arms talks with the United States.

Arms Cooperation or Race in Space? The only way to prevent an arms race in space would be to improve the legal basis for activity in outer space, particularly by expanding restrictions and bans on weapons deployment in orbit and on developing land-, air-, and sea-based means of destroying objects in space. If global competition intensifies, more space incidents—such as the accidental collision of Russian and US satellites in 2009—will probably occur. In addition, antagonists might disrupt the operation of each other’s space systems, with unpredictable socioeconomic and military consequences.

Chemical and Biological Weapons. Regardless of whether the major powers cooperate or compete, by 2025—much later than the deadline set by the 1992 Convention—global stocks of chemical weapons held by states will have been destroyed in full. The situation pertaining to biological weapons is different, however. The ban on these weapons, established by the 1972 Convention, is not supported by a verification system. The development of new bans and controls for new types of bio-weapons (e.g. through genetic engineering) would be possible on a multilateral basis only if the big powers cooperate. 

Proliferation and the Nuclear Energy Threat. With climate change, we can expect to see a considerable increase in nuclear energy use over the forecast period. In a worrisome trend, the increase will occur in many unstable and conflict-prone parts of the world. The current drop in global oil prices could slow the pace of nuclear energy development but will not change the fundamental trend.

During the next twenty years, a breakdown in the barriers between “military” and “peaceful” nuclear energy use is likely to occur, primarily driven by nuclear fuel cycle technology. 

Nuclear energy (like the space sector, which is linked to missile technology) has both an economic and a political dimension in terms of countries’ status, prestige, and defense capability. Nuclear weapons will increasingly morph from being one of the attributes of the leading powers to being a “weapon of the poor,” to be used against adversaries’ superior conventional forces. This shift increases the risk of their deliberate or accidental use in local wars.

Contrary to the logic underpinning the Nonproliferation Treaty (NPT), peaceful nuclear energy has not become an attractive alternative to developing nuclear weapons. North Korea used nuclear energy as a cover for developing nuclear weapons and, for many years, Iran had been suspected of following North Korea’s example. By 2035, other countries in Asia, Africa, and Latin America—many of which are unstable and/or are involved in regional conflicts—might also take this road. 

Strengthening the nuclear nonproliferation regime and the NPT requires consensus among all NPT signatories (currently 190 countries), including countries that could violate the treaty. This is hard to achieve even under the best possible circumstances, but would be completely impossible if the great powers think in confrontational terms. Until 2035, more threshold countries are likely to emerge, and in the worst-case scenario, a chain reaction could occur in which nuclear proliferation leads to an expansion of the “nuclear club” from nine to fifteen or more members. This would greatly increase the probability of nuclear weapons use in regional conflicts and of terrorists getting access to a nuclear explosive device. 

Preventing nuclear terrorism is clearly an area of common interest between the great powers and their allies, regardless of the nature of their relationship. However, cooperation among Russia, the United States, and other countries on the security of nuclear munitions and materials in a bilateral and multilateral format could be restored and expanded only if tensions do not escalate and the major powers do not compete in other realms.

Are you interested in reading other sections in this report, particularly about the future of the global economy, new technologies and regional trends? If so, go here. 

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Dr. Mathew J. Burrows serves as the Director of the Atlantic Council's Strategic Foresight Initiative in the Brent Scowcroft Center on International Security. His topics of expertise include emerging technologies in defense and NatSec, global trends, non-traditional threats, and urbanization. 

Professor Alexander A. Dynkin is the Director of Primakov Institute of World Economy and International Relations (IMEMO) and is one of the leading Russian specialists in the world economy and international politics. His research areas comprise the issues of economic growth, forecasting, energy, international comparisons, the patterns of innovation development, global issues, international relations and international security.