Last week NATO concluded its 75th Anniversary Event in Washington DC. It was supposed to be a symbol of unity, strength, and most importantly a chance to announce that Ukraine would have a formal pathway to NATO. Unfortunately for NATO, none of that came to pass. Just listen to the words of former US Ambassador Chas Freeman who reveals what the summit actually accomplished:
“Instead of strengthening NATO and showing its power, the summit did the opposite. It laid bare its cracks, its failure to deal with reality, and its incapacity to respond to the emergence of multipolarity”
I want to focus on that last word “Multipolarity” because it’s probably the most important word in modern day geopolitics. At the end of WWI, the world was “unipolar”. The United States was the sole superpower and the US Dollar was king. With the emergence of the SWIFT banking system, the United States government and financial system was in control of the world and this is what world trade looked like in 1960:
But fast forward 40 years and the changes couldn’t be more different.
By 2020, China was the dominant trading partner for the majority of the world. Germany still serves a primary role as the engine of the EU economy, but this is what multipolarity represents, the emergence of multiple “superpowers” with the two greatest being the United States and China.
With the emergence of China, developing countries around the world now have options and China has employed one of the most successful foreign policy programs the past decade with the Belt and Road Initiative, inviting over 150 countries and making huge tangible progress for developing nations throughout the Global South, areas comprising of Latin America, Africa, the Middle East, and Southeast Asia.
Even the new Republican VP nominee JD Vance admitted in a speech last year why China’s foreign policy has been so successful:
The days of US hegemony and a unipolar world are officially over and this is why we’ve seen such an intense rivalry between the US and China emerge. Smaller developing countries now have options and trade alliances like BRICS, founded by Brazil, Russia, India, China and South Africa, have now become the chief rival to the American led G7 alliance.
The BRICS alliance is gaining tremendous momentum. In the past month alone, new reports indicate that Turkey, Malaysia, and Thailand are now all interested in joining the alliance later this year. In the future, this new multipolar world will give a serious challenge to the status of the US dollar as the world’s reserve currency and here are 3 emerging trends you should be watching:
BRICS Growth - This October, Russia will host the annual BRICS Presidents meeting and discuss which new countries will be admitted into the alliance. There are over 40 countries interested in joining the alliance with every nation in Africa at least expressing an interest in joining BRICS. Over time this alliance will continue to grow and give more pressure to the US and the G7
Debt - The US Government National Debt increases by $8 billion dollars EVERY day. This is absolutely absurd and dangerous as the US government’s addiction to wars across the world is simple unsustainable. We are sending billions to Israel, billions more to Ukraine, and are now looking at a new potential war with China over Taiwan.
Dedollarization - With the emergence of BRICS, countries around the world are shifting away from the US dollar in international trade. For example, India and Russia have announced a new partnership that will allow for seamless cross-border transactions without the need for U.S. dollars. Their stated goal is to increase the trade volume between Russia and set a goal to achieve $100 billion in trade turnover between Russia and India by 2030.
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Cyrus
Greetings Cyrus,
Since Substack doesn't allow me to update my expired credit card, I can't choose one of your, subscription renewal offers. I suspect I am not the only one with this problem. I am 81 years old and therefore would never agree to any automatic credit card renewal. Furthermore, Substack doesn't allow reply to their email. I don't know who they are or where they are located.
Thank you very much Cyrus for sharing the important News and the fascinating graphics on the evolution of global trade