Special Report Chatham House Expert Perspectives 2018 Risks and Opportunities in International Affairs

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A World in Transition

Adam Ward

There is a sense that the established order is shifting as old certainties in international affairs unravel. More contested and fluid arrangements for global governance are in prospect.

International affairs today present an abundance of ambiguities and analytical challenges. The feeling of transition from an established order of sorts – to the extent that the structures and rules-based norms that have governed relations between states since 1945 form a coherent whole – is vivid. We see America, almost daily under Donald Trump, retreating from its international responsibilities; a more assertive China starting to seek to shape global institutions and relationships to its agenda; democracy in retreat and populism on the rise in many countries; and technology disrupting societies and economies in countless ways.

But if the reality of a departure – broadly speaking, from the Western-led system of recent decades – is unmistakeable, the destination remains opaque. Emerging contests for geopolitical advantage, and for control of the shape of future global governance, are still being played out. Everything is up for grabs. In this context, it is inevitably hard to be precise about the medium-term future. The likely shape of the world order of the 2020s, 2030s or 2040s, and the relative power relationships of the key players within it, are necessarily indistinct. One can, however, seek to describe some of its probable general characteristics, and identify the essential drivers that are destabilizing current structures. At a time of transition, it is the risks that mainly draw attention. But opportunity is also inherent to global change.

The first thing to note is that change in the contemporary world is occurring at a perceptibly accelerating pace and is driven from many directions. Globalization has created an intricate infrastructure through which ideas and impacts are rapidly transmitted. Localized political developments can quickly assume wider international importance. Across a dense web of interdependencies, many different actors – states, non-state groups, businesses and civil society – are reacting to flux, striving to adapt, and opportunistically pursuing or defending their interests to whatever degree their resources allow. Technological innovation, meanwhile, is increasingly commanding a structural and revolutionary power over modern life.

Geopolitics is becoming more fragmented. A more contested, multipolar order of some description has been gradually coming into view for some decades, but it is only now sharpening into focus. This development has featured a redistribution of economic, military and diplomatic power among states (and other geopolitical centres of gravity). The shift has intensified as the two principal global powers – the US and China – have redefined how and under what terms they seek to exert themselves internationally. This has prompted a wider set of powers to reassess their options and imperatives.

Both the American and Chinese cases are striking. The US has undergone an extraordinary evolution since emerging as the architect of the post-1945 Western order. That order was based on economic dynamism, hard power, solidarity in shared basic political values, and enlightened self-interest – even a degree of philanthropy – in US dealings with allies. For all the problems and inconsistencies with this model, the US-led approach proved more resilient than that of the Soviet Union, which dissolved in 1991 under the costs and strains of waging a decades-long rivalry on a global scale. Since that seminal geopolitical accomplishment, however, US foreign policy debates have been consumed by differences of opinion about the appropriate balance between prioritizing domestic needs and fulfilling international commitments – and about the nature of the relationship between these two imperatives.

That debate reached its peak in the convergence of stresses produced by the US military interventions in Afghanistan and Iraq after 9/11, and by the global financial crisis in 2008–09. The answer proposed by the administration of Barack Obama was a policy of retrenchment, a more selective and discretionary approach to international engagements, and a tightly drawn interest calculation to govern future US policy. Nonetheless, the US’s practical and rhetorical commitment to international causes and global leadership was sustained. There was little to foreshadow the ‘America First’ principle on which the Trump administration has since built its foreign policy, and which has found favour with its populist base.

Two factors underline why Trump’s approach has been so dislocating to date. The first is that it has carried a transactional mindset to extremes, even in Washington’s dealings with allies. This has entailed an implicit circumscription of the US’s international security commitments, combined with an explicit readiness to use trade policy as an instrument of economic punishment. The second is that the Trump approach has for all practical purposes denuded US foreign policy of much of its traditional soft-power or values-based content. This trajectory, taken to its logical conclusion, implies America detaching itself from the exceptionalist self-image that it has cultivated and projected for decades. The US would instead join the ranks of the narrowly interest-driven states that it has customarily disapproved of in the past. It would become, in other words, a conventional great power.

Some of the administration’s most jarring foreign policy postures and decisions are still so recent as to permit debate about the likely permanence of the US retreat from internationalism. It is unclear, in other words, whether we are seeing the initial manifestations of a secular shift or a transitory deviation from a recoverable path. The administration has strayed so dramatically from the classical precepts of US international leadership, and has created so much domestic controversy in doing so, that some observers think a corrective rebalancing is inevitable at some future point. What Trump has done can be undone, in effect. Other assessments, however, acknowledge with concern just how quickly the institutions, regulations and compacts of an established world order – when neglected by their most powerful sponsor – can begin to decay, perhaps beyond the point of meaningful repair.

As America’s strategic presence has started to shrink, so China’s has expanded. China’s more assertive and outward-looking posture predates the Trump administration, but has been accelerated in reaction to it. This posture had its roots in several factors: Beijing’s perception of a loss of nerve and competence on the part of the US in handling geopolitical and economic affairs, following 9/11 and the global financial crisis; a calculation of the openings offered by the Obama administration’s more reticent foreign policy; and a growing awareness of China’s own gathering strengths and widening international interests. China’s leaders and foreign policy community sensed in this a moment of strategic opportunity, warranting a departure from the extreme caution and restraint advocated by former paramount leader Deng Xiaoping.

No one seems to have absorbed the import of this opportunity more than China’s current president, Xi Jinping. Xi has developed a narrative about China’s future that is wreathed in notions of national renewal and greatness, allied to the view that China must claim its place at the centre of a system of global governance that reflects its interests and preferences more closely. Great-power rhetoric has been accompanied by a new determination to develop and use the instruments at China’s disposal, whether in the rapid enhancement of military capabilities or the deployment of ambitious economic statecraft through the ‘Belt and Road Initiative’. Xi’s consolidation of his leadership suggests that confident extroversion will be a strengthening theme in Chinese foreign policy over the next decade. However, China’s international assertiveness is likely to be tempered by the Communist Party’s recognition that the inflexible absolutism often inherent in nationalism can rebound on governments; and that improving economic well-being offers a safer basis for political legitimacy over the long term. To this extent, a political preference for external stability can be expected. Ultimately, however, the scope of China’s global outreach may be determined by the pace of America’s withdrawal from the international arena; and by the degree to which Washington allows Beijing to inherit the management of international affairs in regions and on issues where the US is no longer or much less engaged.

In this changing landscape, the other significant international powers will have to weigh the dilemmas of risk and opportunity that confront them. America’s allies will have to decide whether they should work to convert the Trump administration to the importance of the Washington-led order; whether they should try to uphold a version of this order that is independent of traditional US support; or whether they ought to seek solidarity and self-reliance among themselves, in resistance to the Trump agenda.

At present, there is evidence that all three strands of thought are commingling indecisively in policy. Europe’s indignant estrangement from the US is still bracing in view of the subversive challenges posed by Russia, especially at a time when a range of issues – from populist movements to the UK’s prospective departure from the EU – have sapped confidence in the European project. Meanwhile, for Japan the pressures are in some ways more immediate and the options narrower. Japan inhabits a region defined not only by all the competitive pressures of economic and technological modernity, but also by those of hard-nosed geopolitics. Maintaining US engagement in the Asia-Pacific region on terms that are consistent with Japanese interests has become much more challenging in light of the Trump administration’s disavowal of the Trans-Pacific Partnership, of which Japan is a prominent sponsor. Japanese foreign policy has also been complicated by the abrupt turns Washington has made – from steely confrontation to exuberant conciliation – in its dealings with both North Korea and China. Fear of abandonment on the one hand, and of US miscalculation on the other, has forced Tokyo into a process of elaborate courtship of Trump that to date has yielded few rewards.

Russia has its own dilemmas to consider. In the short term, it must decide how far to carry what critics describe as a campaign of harassment against a divided West. The Trump administration – or, more precisely, Trump himself – has maintained an attitude of forbearance and indulgence towards Russia. For now, Trump’s improvised foreign policy is useful to Russia. However, Moscow is presumably alive to the risk of overplaying its hand when dealing with a US president whose calculus and allegiances can swing wildly, and who is unembarrassed by inconsistency. There is also a larger question for Russia, which concerns the extent to which the country intends to continue drawing its sense of stature from antagonism with the West, when the default geopolitical costs of this strategy are greater reliance on China.

Meanwhile, the traditionally independent-minded powers of India and Brazil still have to determine how to define their interests in this shifting scene. Their distaste for what they see as the exclusionary features of the post-1945 order is well established, but they do not have the means to effect change. While their foreign policies have often reflected resentment of US power, neither country has demonstrated any countervailing sense of strategic affinity with China or Russia.

Given so many potential shifts in agendas and relationships, it is prudent to assume that geopolitics in future will increasingly involve a kind of ‘balance of power’ approach: combining fluidity in countries’ alignment on specific issues, and alliances of convenience to deter egregiously disruptive behaviour. This more adaptive and less formalized international system, based on expediency more than on rules, presages less stability in security terms. For instance, it raises concern about the degree to which powers hitherto locked in stand-offs – avoiding direct confrontation but engaged in peripheral struggles – may feel they have the freedom (and the need) to throw off their current restraints. A salient case here is the contest between Iran and Saudi Arabia. Another concern is the growing number of ways in which states can engage in attrition with one another, for example using cyber instruments; the threshold for acts of war in such instances is neither well demarcated nor universally agreed.

The key task for diplomacy in this more diffuse and fragmented world will be to achieve a workable co-existence between competitive powers whose observance of traditional institutions, norms and regimes will become more patchy and selective. The principal players involved will reflect a greater variety of political and social models, and will have differing attitudes about the accommodations they are willing to strike on questions of interests and values. With grand bargains seemingly out of reach and institutionalized policy coordination in retreat, the rules of the road will likely develop organically and messily.

This cramped set of circumstances is likely to be reinforced for the foreseeable future by trends in politics and society. Identity politics has risen to prominence in many countries, albeit in differing forms and with differing degrees of intensity. Religious sectarianism in the Middle East, nationalism in Asia and Russia, and populist-sovereigntist movements in the US and Europe are examples. All are based to some degree on exclusion, notions of control and a tendency towards illiberalism. Although none of these movements have achieved positions of dominance, they have had definite political effects. This has played into a pervasive sense that authoritarianism is on the march and that democracy is in retreat.

That said, concerns on this point should not be exaggerated: established democracies throughout the West have shown themselves to be rattled but resilient. They now face the task of revitalizing themselves, principally by demonstrating a greater capacity to deliver economic vitality and the services that their populations expect. Moreover, while authoritarian systems sometimes have more freedom to take unchecked, decisive action, they trade this advantage for the weaker capacity for renewal that aversion to dissent creates over the long term.

The global economy has been an early victim of the more contested political and institutional environment. Protectionism has dealt blows to an already troubled multilateral trade regime. As with the wider project of globalization, there are no easy levers with which to recalibrate the system or correct imbalances. Intense jostling for advantage seems set to continue, though ultimately this is likely to be conducted largely within existing institutional boundaries: the costs of excessive economic disruption will continue to provide an important restraint.

Less cooperative intergovernmental conditions will also require actors in civil society to mobilize as a compensating source of transnational coalitions of interest. There have been some encouraging examples of this, especially in the quintessentially global area of climate action. Other policy areas, such as fostering global health resilience, invite similar action. Meanwhile technological advances, if they can continue to be harnessed to tackling international policy challenges, should provide added scope to circumvent reliance on formal state action. The ability of technology to facilitate cooperation and mass mobilization has been seen in numerous areas, from resource policy to human security.

Amid the disorderly dynamism of this emerging international operating environment, all actors will face increased risks for the foreseeable future. At the same time, the creation of opportunities to resolve common challenges will grow in both importance and difficulty. The articles compiled in this volume, the first of a new annual series, have been written by Chatham House experts and reflect their perspectives on geopolitics and security, politics and society, governance, the global economy, and issues around resources and the environment. These articles are not intended to provide an exhaustive account of the state of the world, but to selectively highlight some of the trends that are coalescing into definable shape as risks or opportunities. They draw on Chatham House’s capacity for regional, thematic and technical evidence-based policy research. They are informed by the sense that the future will be one in which risks will certainly need to be assessed carefully, but so too the new solutions to policy challenges that can help shape an evolving global landscape.

Adam Ward is the deputy director of Chatham House.