The Covid-19 pandemic had shown the excessive dependence of developed economies on supply chains from emerging countries, particularly China. This fragility has pushed them to redefine a more sovereign and strategic industrial policy, as evidenced by the plan NextGenerationUE in Europe, or the recovery plans in the United States. The war in Ukraine showed Europe that energy could turn into a geopolitical weapon in the hands of Moscow, which made it extremely vulnerable. This awareness today has put an end to the “happy globalization” that Donald Trump had already torpedoed, with his “America First” program and protectionism that targeted China.
Because far from having succeeded in integrating all the countries, the division between developed countries and emerging countries has been revived in recent years, to such an extent that we have been able to the return of the cold war.
A warm welcome for Vladimir Putin
Testifies to it the last summit of the Brics, which brought together Brazil, Russia, India, China and South Africa at the end of June. Considered a pariah in the West, Russian President Vladimir Putin received an excellent reception. In his speech, he denounced the economic sanctions imposed by Western countries and called for the unity of emerging countries. He was able to count on the support of President Xi Jinping, who does not intend to comply with the boycott demands of Western countries and has appointed “American expansionism” as being “the main world problem”. In particular, China has repeatedly expressed its understanding of Russia’s position that expanding membership in the US-backed North Atlantic Treaty Organization (NATO) threatens its security. national. The subject is not new, it is part of the competition between China and the United States for the status of the world’s leading economic power.
Because behind this rhetoric, each country defends its own interests. Three members of the BRICS, China, India and South Africa, had abstained during the vote in early March on a UN resolution condemning the invasion of Ukraine by Russia, and Brazil had voted in favor. The neutrality of Beijing and New Delhi can be explained by the close military ties that these two countries have with Moscow. And for a few weeks, they have become the first buyers of Russian oil, realizing a good deal because sold at a price lower than that of the market.
Side effects
Nevertheless, during the summit, some representatives pointed to the collateral effects of Moscow’s decision to embark on this war against Ukraine. In particular inflation and in particular that concerning the prices of energy and food products, but also the disruption of the supply in particular of cereals. In the final communiqué, the group supported the option of early talks between Moscow and Kyiv, thus expressing their desire for a negotiated solution to return to normal.
Indeed, emerging countries in Africa, Asia and Latin America, especially for the smallest of them already weakened by the pandemic, are seeing rising risks of social unrest due to high prices of basic food products. and shortages of gasoline and electricity, following the example of Sri Lanka, in the midst of chaos.
Because beyond geopolitics, the priority of emerging countries is economic development (over the decade 2011-2021, they accounted for 67% of global growth). Brazil, Russia, India, China and South Africa alone are home to more than 40% of the world’s population and account for nearly a quarter of the planet’s gross domestic product (GDP) (nearly 50% including all emerging countries). This is why the Brics present themselves as a spokesperson for all emerging countries.
She is far from the only one. In all regions of the world, emerging countries are consolidating their collaboration. Following the example of the largest regional organization in the world, Shanghai Cooperation Organization (SCO) where we find among the 21 member countries China, Russia, India but also Pakistan. Their total territory exceeds 34 million km², which is more than 60% of the territory of the Eurasian continent. Their total population is more than 3 billion people, almost half of the world’s population.
Disputes between India and China
In addition, each emerging country seeks to promote its trade with Europe and the United States. Narendra Modi, India’s prime minister, agreed to an Indo-Pacific economic framework promoted by Washington to counter China’s commercial power in the region, but refused to cave to Joe Biden on Russia’s condemnation.
Besides, China and India have many disputes and conflicts, for example in Kashmir. And if India has recently become one of the main buyers of Russian crude, it is also because its refiners intend to sell their gasoline, diesel, heating oil and kerosene to European countries.
As for Brazil, while it has officially opposed the war in Ukraine, it has refused to support the sanctions, because a fifth of its fertilizers are imported from Russia, necessary for the agri-food sector, a pillar of the economy. Brazilian economy.
Interest also works the other way around. Joe Biden traveled to Saudi Arabia in July to convince Riyadh to increase its oil supply on the world market, in the hope of lowering fuel prices in the United States. The president thus abandoned his idea of transforming the Saudi kingdom into a pariah state as he had claimed when arriving at the White House, after having authorized the publication of a CIA report which accused Crown Prince Mohammed bin Salman of sponsoring the 2018 murder in Turkey of Saudi-American journalist and opponent Jamal Khashoggi.
Awareness of Western countries
In this new situation, Western countries have also become aware of having relations with emerging countries. At the end of the G7 summit, the announcement was made a commitment to raise $600 billion in private and public funds over five years to finance infrastructure in emerging countries, especially sub-Saharan Africa, to help them develop, but also to ensure access to raw materials, especially metals. The objective is not to leave China alone, which has invested massively for years in a number of developing countries until it has become the main creditor (see graph), by granting certain facilities, which nevertheless turn out to be a trap for some. Thus, Sri Lanka finds itself so dependent on Chinese financing that to restructure its debt, it is obliged to sell certain assets, such as the management of one of its main ports.
This initiative, here too, is a matter of awareness. The G7 countries devote on average only 0.32% of their gross national income, less than half of the promised 0.7%, to development aid. It is an additional illustration that it is indeed the rivalry between China and the United States that structures the new globalization, each country or region positioning itself in relation to this axis according to its interests.
