The Emerging Powers in the New World Order and the Post-Carbon Age

"While the White House was thinking about what else to turn off in the world, ban or spoil, Argentina and Iran applied to join the BRICS,"  - wrote Maria Zakharova on the Telegram messaging app. The critical edge towards the United States is not accidental, with the BRICS alliance seen by some analysts as a kind of geopolitical antipode of the Western world. This could be of particular significance for the emergence of the 'new world order' envisaged following the Russian offensive against Ukraine.

Global governance - from China?

A 2001 Goldman Sachs economic forecast found that the 2000s and 2010s could be a period of rise of the BRICS. The forecast proved partly correct, especially as far as India and China are concerned (Russia less so). China was then overtaking and overtaking Japan economically and beginning to close rapidly on the US. According to World Bank data, China's economic output was less than USD 1 trillion in 1991, while in 2015 it was approaching USD 10 trillion. In terms of per capita income, it has also grown at least eightfold in about a quarter of a century, beating Japan, the Asian Tigers, Hong Kong, Taiwan, Singapore and South Korea.

Of course, there were several factors behind the "Chinese economic miracle", but two of them are of global political significance: The first is that China has become the world's manufacturing powerhouse, producing almost a third of global manufacturing output, and attracting multinationals like a magnet. The second important aspect is that China has not hindered, but rather sought to 'mould in its own image' the Western world's concepts of global governance since the 1990s. In any case, China's history is not far removed from its sense of cultural and political superiority, as the term 'Middle Kingdom' or 'divine state' has referred to since antiquity. „China’s approach to multilateral regimes is part of a more general issue: how rising powers – which in the future may include states beyond China, such as India and Brazil – approach global governance. When, and to what extent, do rising powers passively accept existing rules? When do they actively invest in and help strengthen existing institutional architecture? When do they obstruct or play hold-up with existing institutions? When do they construct new institutions? The way that emerging powers approach global governance issues will have enormous impact on the future of world order.” – explained Scott L. Kastner.[i]

A classic example of China's international strategy is the United Nations: the communist regime has steadily increased its financial contributions to the world organisation and, in parallel, has gained more and more positions in the various UN institutions, at least temporarily reinforcing the isolationist tendencies of US foreign policy. Unlike the UN, China's behaviour in other multilateral international systems is described by many scholars as 'variable' and 'difficult to calculate'. This is a realistic picture, despite the fact that since the end of the Cold War and the demise of the Soviet Union, China's international influence has grown enormously, mainly due to the exponential growth of its economic and military power. One of the reasons for this may be that global financial institutions were set up during the Cold War period without China's involvement, on the basis of Anglo-Saxon ideas. Another reason may be a general strategic consideration in international politics: there is greater trust in new institutions and emerging countries, as a superpower like the US and China can more easily influence their operations through the means of the dominant power. Another profane reason played a major role even earlier. „In most countries, domestic politics plays a big role in driving foreign policy. But this may be even truer in China than in other places. China is run by the Communist Party of China (CPC), and the job of the various ministries, including the foreign ministry, is to implement the policies set in Zhongnanhai (the leaders’ compound in Beijing). Neither China’s current leaders, nor its likely future ones, have much experience of foreign policy. Indeed, those who do have international knowledge hold low positions in the hierarchy. (…) This means that when decisions are taken on foreign policy, domestic considerations are likely to be paramount.” – wrote Charles Grant.[ii]

By contrast, an old institution - with the active participation of other countries - is a sphere of political compromise and debate. While China made great efforts to join the WTO, for example, it did not play a very constructive role in the international institution for a long time afterwards: this meant accepting the rules in principle, but often following a hold-up strategy. Until the financial crisis of 2008, the situation was similar with the IMF, but since then China has tended to work to secure concessions in its own interests. A counter-example is the 'six-party talks' initiated by China: in this case, China made a serious effort from the outset to achieve meaningful results for the countries concerned (Japan, North Korea, South Korea, Russia, United States) during the second period of nuclear tension (2002-2003). Despite the opposition of the United States, China has pursued a clearly expansionist policy in the last decade in the institutions for the development of science and technology (such as the International Organization for Standardization (ISO), the International Electrotechnical Commission (IEC), the International Telecommunications Union (ITU), the 3rd Generation Partnership Project (3GPP), etc.). „The European Union, Japan and the United States still have a clear advantage in this area, but it has relatively deteriorated in the 2010-2020 decade.” – stated the Warsaw Institute.[iii]

SCO – potential Warsaw Pact?

Another important arena for the attempt to strengthen global - regional institutional influence is the history of a little 'discussed' and somewhat mysterious international organisation in the Western media, the Shanghai Cooperation Organisation (SCO). The Beijing-based SCO, which brings together, in addition to China, Russia, India, Pakistan and four Central Asian countries, was originally established in the 1990s to maintain regional security. However, China has sought to use the agreements concluded under the SCO umbrella, for example on energy trade and border security, to secure its trade routes to Western countries. „Beyond its importance to its member states, the development of the SCO is of wider significance to global politics, security and economics. (…) A lot of existing work examines the SCO in light of its geopolitical considerations for the West, and the US in particular. Many Western analysts portray the SCO as a joint Russian–Chinese geopolitical device established in response to the growing US presence in Central Asia. It is thus argued that ‘SCO primarily serves as a geopolitical counter weight to the United States’. Such interpretations range from sensationalist accounts, proclaiming that ‘SCO is “the most dangerous organisation Americans have never heard of” and ‘a potential Warsaw Pact’, to academic accounts outlining the potential challenge it represents to Western interests in the region.” – explained the importance of the SCO Stephen Aris.[iv] But the reality is that deep cooperation between member states is inherently hampered by strategic rivalries between the strongest members. This is, of course, a major obstacle to China's freedom to build the Belt and Road Initiative according to its own economic interests. Despite the generally "good and friendly" relationship, there is a lack of balance of power between China and Russia and their diverging strategic interests. This is particularly true in Central Asia, a region Moscow is trying to keep firmly under control, and maintaining economic and political influence is a key element of Russian foreign policy. Consequently, however, it has already been difficult to build a strong alliance between Russia and China in the SCO framework between 2010 and 2020. Indeed, it is in China's economic interest to open markets in these countries to Chinese goods. Similarly, there is a clear source of tension between China and India. China has sought to play a stronger role in Pakistan, which has increased India's mistrust of China. Nevertheless, the SCO continues to play an important role in China's strategy, as it allows the Chinese leadership to remain in closer contact with Central Asian states such as Kyrgyzstan and Tajikistan. For these countries, China can continue to act as a dominant supplier of trade, energy and security, thus strengthening its position.[v]

Raw material superpowers

In the years following the global economic crisis of 2008, many economic analyses have already pointed out that the BRICS and SCO member states are ahead of the developed Western countries in many indicators and especially in terms of the pace of development. In the mid-2000s, an OECD analysis had already reported that by 2030, China and India together would account for approximately 40 % of global GDP, while the United States and the European Union together would account for only around 30 %. Another analysis showed that the BRICS countries could surpass the combined productivity of the G7 in the 2030s. Although longer-term economic forecasts are often inaccurate, the BRICS/SCO's raw material superiority over Western countries, especially Europe, seems even more pressing in the light of the growing energy crisis in recent years. Russia, which has the world's largest reserves of natural gas and one of the world's largest reserves of oil, could be joined by Iran, also a top producer. In addition, Saudi Arabia, the world's leading oil producer, also sent representatives to the last BRICS meeting at the invitation of China.

Of course, raw materials and global power have always been closely linked in human history. As early as 1953, Demitri B. Shimkin in his detailed analysis compared the mineral base of the United States and the Soviet Union in terms of global power, for example by assessing the reserves of various metals, petroleum, coal, gold, etc. Shimkin said at the time that the mineral reserves of the United States and the Soviet Union (Russia) were of a similar order of magnitude, only that the United States had already used more and that there were probably still vast areas of Russia still to be discovered and exploited.[vi]  In his paper, Tim Di Muzio pointed to the little-discussed link in human history between economics, politics and energy. And in the last century or two, coal, petrol and oil have been the key drivers of human development: „What I mean by the term petro-market civilization is an historical and contradictory pattern of civilizational order whose social reproduction is founded upon nonrenewable fossil fuels, mediated by the price mechanism of the market and dominated by the logic of differential accumulation.” – wrote Di Muzio.[vii] Capital, it is argued by Di Muzio, is also a product of the petroleum civilisation, the vast accumulation of capital made possible by the surplus of fossil fuels. This also represented a sharp break with earlier forms of social reproduction that required low-carbon energy. This is particularly evident in the history of the United States, which was, in Di Muzio's words, the 'first Saudi Arabia', as oil was found in vast quantities on US soil. This was a decisive moment in the rise of the United States. Carbon capitalism thus implies that fossil fuels were the basic condition for the accumulation of capital and for modern - energy-intensive - forms of social reproduction. Of course, the post-carbon era will therefore also bring about a decisive change in global politics: according to Di Muzio, the change is based on the fact that the four big BRICS states - China, India, Russia, Brazil - have started to build their own energy-intensive systems in recent decades, thus fundamentally changing the global energy order and, in the future, the world order.

The solution, according to many experts, is to use renewable energy sources. However, the fact that the BRICS countries also have the upper hand in terms of mineral resources for renewable energy sources could be an even bigger headache for Western countries. And under China's leadership, the BRICS have already set up a development bank (New Development Bank - NDB), one of whose main tasks will be to develop a sustainable strategy for the energy and resources available to the BRICS and an alternative to Western financial systems. India came up with the idea of a development bank in 2012, followed by South Africa with more detailed plans in 2013. But China has played an active role in setting up the institution. The NDB aims to finance various sustainability and infrastructure projects and to build partnerships with national, regional and multilateral financial institutions in these areas. The five founding members have contributed USD 50 billion in equal shares to the NDB. The first four major projects - in Brazil, India, China and South Africa - began to be financed by the NDB in 2016. (Another important institutional development for China was the Asian Infrastructure Investment Bank (AIIB), which the Chinese leadership used to provide a financial institution for the One Belt, One Road (OBOR) project.)[viii]

The BRICS countries could therefore also pose a real and serious challenge to the institutional legacy of the post-World War II Western Bretton Woods system. "The question is not whether US hegemony will end, but how it will happen and what will take its place." - wrote political scientist Oliver Stuenkel in 2015 in his analysis of the rise of the BRICS. Stuenkel's view is that the crucial point is that the economic growth rates of the emerging powers, and primarily China, have been consistently higher than the statistics of the developed states, a change that is leading to an increasing deconcentration of economic power. While it is true that the original concept of the BRICS was mentioned by Goldman Sachs in the context of a purely economic analysis, the motivation and common interest of the BRICS was fuelled by a shared dissatisfaction with the international power structure. The desire for a revision of the international power-sharing structure was therefore indeed an important driving force for the BRICS group. However, despite the common starting point, there were also common dilemmas for the BRICS, such as what should and could be done with the institutions of the liberal international order and what responsibility the BRICS would have in shaping a new system. Nor was the question of the extent to which each BRICS state can remain autonomous vis-à-vis the other BRICS states if it acts together against US hegemony insignificant. „While the BRICS are united in their wish to reform parts of today’s global structure, the quota system of the World Bank and the IMF, their institutional revisionism is far from all-encompassing. For example, there is no consensus among the BRICS about the need to reform the UN Security Council, most notably because Russia and China are permanent members and therefore are less supportive of reforming the body than Brazil, India and South Africa. Finally, with the traces of European imperialism remaining a political factor in several of the BRICS’ societies, the members tend to be critical of the growing scope and intrusiveness of international rules and norms, which, they fear, erode the respect for state sovereignty or the inviolability of borders, and create pretexts for Western powers to readily intervene on humanitarian grounds. The process of delegitimization by the BRICS grouping is thus not only selective, but also relatively vague and not coordinated.” – emphasized Stuenkel.[ix]

New „Cold War” vs. fragmented multipolarity

Based on the offensive against Ukraine and the political communication of the Russian leadership, it seems that Russia already wants to end Western dominance. "In several security meetings, I have seen Chinese diplomats rolling their eyes at some of the manifestations of Russian envoys. The Chinese are much more skilful, more thoughtful, less brutal and more attentive to the principles of territorial and national integrity that they invoke in relation to Taiwan."- Sir Robert John Savers, a former senior British intelligence officer, explaining the difference between Russian and Chinese foreign policy attitudes a few days after the Russian military action in February. However, Russia, increasingly constrained by poor economic indicators over the past decade, had another reason for its 'shift' towards the West beyond the 'difference of approach': despite certain common interests, there was a conflict of interest between the Chinese and Russian leaderships. China wanted to turn the Central Asian region into a free trade area within the SCO, but Russia, fearing Chinese dominance in the region, was reluctant to do so.[x]

However, this is not the only point of tension in BRICS, it is no coincidence that the political-geographical-cultural fragmentation of the organisation is seen as a weakness. The most significant fault line is clearly between India and China: in addition to unresolved border disputes, China, which is facing a deepening credit crisis and even more drastic demographic challenges, could also see a serious rival in the Indian economy, which is still underdeveloped but growing twice as fast as its current pace. In recent years, there have been several signs that tensions between the two giants could even increase in the coming years. Border tensions were clearly the most serious in 2020. A further sign was India's termination of cooperation under the Regional Comprehensive Economic Partnership (RCEP) in 2019 over fears that the FTA would be used by China to gain access to Indian markets for its own benefit. There was also a strong sense of rivalry between China and India over health diplomacy during the COVID-19 epidemic. The China-India relationship is also significant for the global order because a few years ago the idea of a hidden India-US cooperation with China was still very much in place.[xi] An example of cultural differences is Brazil, which has taken a different position from the other BRICS states on the Israeli-Palestinian dispute and supported the US decision to move its embassy to Jerusalem. There are also significant differences, for example, in terms of militarism and nuclear weapons strategies in particular. Brazil has repeatedly demonstrated its active involvement in nuclear disarmament since the Second World War, in contrast to Russia, for example.[xii]

It is precisely this fragmentation that is the main reason why, despite the rising tensions between the United States and the two leading BRICS states, Russia and China, many analysts talk of a kind of "fragmented" multipolar world order rather than a "new Cold War".  Moreover, the extremely close economic relation - almost dependence - between the US and China implies the maintenance of global trade chains: put simply, the 'manufactury of the world' continues to require Western financial resources, while the US corporate sector needs cheap Chinese labour. Of course, increasing mutual mistrust, deepening recession or political decisions taken through the energy war could still change everything quickly in reality.

[i] Scott L. Kastner, Margaret M. Pearson, Chad Rector: China’s Strategic Multilateralism. Investing in Global Governance. Cambridge University Press, Cambridge, 2019. 2.

[ii] Charles Grant: Russia, China and the global governance. Centre for European Reform, London, 2012. 56.

[iii] Warsaw Institute: Pawel Paszak: China’s Growing Influence in International Organizations. 14. October 2020. https://warsawinstitute.org/chinas-growing-influence-international-organizations/   20.07.2022.

[iv] Stephen Aris: Eurasian Regionalism. The Shanghai Cooperation Organisation. Palgrave MacMillan, New York, 2011. 7.

[v] Alfred Gertsl, Ute Wallenböck (ed.): China’s Belt and Road Initiative. Strategic and Economic Impacts on Central Asia, Southeast Asia, and Central Eastern Europe. Routledge, London/New York, 2021. 168.

[vi] Demitri B. Shimkin: Minerals – A Key to Sovier Power. Harvard University Press, Cambridge, Massachusetts, 1953. 342.

[vii] Tim Di Muzio: Carbon Capitalism. Energy, Social Reproducitona and World Order. Rowman and Littlefield International, London – New York, 2015. 5-6.

[viii] Jose A. Puppim de Oliveira, Yijia Jing: International Development Assistance and the BRICS. Palgrave Macmillan, Szingapúr, 2021. 91-95.

[ix] Oliver Stuenkel: The BRICS and the Future of Global Order. Lexington Books, Lanham, 2020. 170.

[x] The Diplomat: Catherine Putz: China Suggests Free Trade Zone For the SCO. 04. November 2016. https://thediplomat.com/2016/11/china-suggests-free-trade-zone-for-the-sco/   22.07.2022

[xi] Chietigj Bajpaee: China in India’s Post-Cold War Engagement with Southeast Asia. Routledge, London – New York, 2022. 128.

[xii] Carlo Patti: Brazil in the Global Nuclear Order 1945 – 2018. Johns Hopkins University Press, Baltimore, 2021. 211.