Page 20 - WEF Reoprt 2020
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and security have functioned over the
past three decades. Countries would
need to decide which economic system
to be part of—something many have
already said they do not want to do—
and businesses would have to develop
separate protocols. 32
The decline of economic integration would
also remove what many see as a check
against outright conflict.
A need for adaptive
geopolitics
As the outlines of the next geopolitical era
start to emerge, there is still uncertainty
about where the distribution of power
will settle and from where influence will
emanate, but a snap back to the old order
appears unlikely. If stakeholders attempt to
bide their time, waiting for the old system
to return, they will be ill-prepared for what
lies ahead and may miss the point at
which key challenges—economic, societal,
technological or environmental—can be
addressed. Instead, longstanding institutions
must adapt to the present and be upgraded
REUTERS/MAXIM SHEMETOV or reimagined for the future.
However, the trend today is not one in which There are signs of adaptation in the
these two countries are just competing creation of new institutions designed
across common domains but one in which to function in this turbulent geopolitical
each is looking to design its own systems— climate. One example is the Franco-German
its own supply chains, 5G networks and “Alliance for Multilateralism”, a group of
global investment institutions. Already nations working to boost international
investment flows between the two have cooperation in areas such as disarmament,
dropped, each has moved to restrict digitalization and climate change. Another
33
28
technology from the other, and some is the African Continental Free Trade
29
analysts predict China will look to reduce Agreement, which will bring together the
its dependence on the US dollar by holding 55 member states of the African Union to
more foreign currencies. 30 form the largest free trade area since the
formation of the WTO. Narrower, issue-
34
Even if the current trade tensions cool, specific, ad-hoc “coalitions of the willing”
we risk heading towards an era in which are proliferating—including Asian regional
the two countries disentangle their trade and investment instruments, the
economies and create barriers between “Quad” (consultation among Australia,
one another. While leaders in Beijing and India, Japan and the United States), and
Washington have expressed disapproval the Global Coalition against Daesh. While
of an economic decoupling, the policy aiming to address collective priorities,
measures being put in place are paving a however, such adaptive approaches run
road towards that destination. 31 the risk of being less effective because
they lack the legitimacy of broad-based
A return to a kind of cold war or iron curtain multilateral institutions. Still, they point to
economic landscape would fundamentally the need for continued coordination and
change the way in which global business partnership during an unsettled time.
The Global Risks Report 2020 15
