Peter Zeihan, the author of The Disunited Nations discussed what the world would look, if or when the global Order collapses. There will be winner who may adapt to the change, or even ascend to the regional superpower to fill the vacuum, such as Turkey. There will be losers who may lose the access of market, or even energy security, such as Germany. The author evaluate the impacts with the following criteria:
- Food security. Can the country sustain its food supply without reliance on the imports of grains, soybeans, and fertilizers?
- Energy security. Can the country secure its energy supply if the sea lanes from the Gulf is no longer safe?
- Access to the raw material, and labor, and market.
- Age distribution of demographics.
The deteriorated Order
After the WWII, the United States utilized its dominant navy to safeguard the global trade network, and opened up its market in exchange of alliance to fight for the shared adversary, the Soviet Union. The Order spurred the globalization and ushered in the era of the prosperous Long Peace. However, with the collapse of Soviet Union, can the alliance last without a common threat?
The 9/11 attack served as a pivotal moment for the United States, prompting a recalibration of American military in response to the emerging global threat of terrorism, aka Global War of Terror. the U.S. had to make compromises in order to garner support from Russia for military interventions in Afghanistan and Iraq. This geopolitical maneuvering ultimately contributed to a situation where, Europe relied on Russia for 45% of its total gas imports prior to the Ukraine war.
What will happen if the U.S. is no longer willing or capable to enforce the Order, aka the Disorder?
Conflicting Middle East
Saudi Arab is characterized as hollow, geographically and socially. Only 7% of its land is suitable for cultivation making it challenge to sustain itself. While the discovery of petroleum in 1938 brought prosperity, the monarchy remains wary of an educated and organized workforce, relying on expats to build, maintain, care and even defend the country. The Saudi military heavily relies on foreign mercenaries, primarily drafted from Pakistan, Egypt; armed by the United States, and trained by the United Kingdom. The oil wealth has also fueled Saudi involvement in promoting jihadist movements like the Taliban, al Qaeda, and ISIS.
Iran, Saudi Arabia’s ideological and political rival, emerged from the remnants of the Persian Empire. It is unusual for a civilization to rise from mountains, but the surrounding desert seems even less viable. The high cost of transportation hindered industrialization, and the discovery of oil made Iran a prey of western powers. The Iran Resolution overthrew the Pahlavi dynasty, leading to the Islamic Republic of Iran aligning itself with Russia. Iran sponsors various militant groups, including Hezbollah in Lebanon, the Assad family of Alawite in Syria, the Shia in Iraq, Yemen’s Houthi Shiite group, and the Dari-speaking Shia community in Afghanistan.
The Middle East has become a battleground for proxy wars, combining land disputes, ideological conflicts, and independence movements of ethnic minorities. The U.S. has invested significant resources in securing global oil transportation, see the reports from U.S. Energy Information Administration below.
In an era of Disorder, the U.S. may retreat from the Middle East, relying on domestic shale oil production, potentially leading to a shift in alliances. With global powers receded, Turkey may rise up to fill the void.
Turkey, situated at the crossroads bridging Europe and Asia, historically benefited from its unique geographical position. The Ottoman Empire accumulated substantial wealth through land trade routes, including the Silk Road and spice trade until it was marginalized by the advent of deep-water navigation. In the era of Disorder, Turkey is poised to regain significance for the same reasons that made it influential during the peak of the Ottoman Empire.
Duopoly in Asia
China and Japan, the two prominent regional powers in the East Asia, have been profoundly influenced by the Order. Japan initiated the Pacific War in its pursuit of energy source and raw materials. Despite defeated by the U.S. navy, Japan was offered to secure the energy source and gain the access to the U.S. market within the Order, — objectives they fought for.
China was initially in the Soviet Union’s orbit, then it adopted the reform and open-up policies, known as gaige kaifang under the leadership of second-generation leader Deng Xiaoping. The export-driven economy was nutriated by the cheap labor, bottomless credits, and easy access to the global market to transform China from a country with 800 million people making less than $1.90 per day to the world’s factory and global economic engine.
In the era of Disorder, China could face the most significant challenges. It imports essential commodities such as grains, iron ore, and crude oil from all over the world, and exports a substantial volume of goods to the global market. As indicated by the National Bureau of Statics of China, the per capita disposable income of residents nationwide was 36,883 yuan, roughly $5,200. This underscores the challenge to accommodate China’s extensive production.
Japan faced similar challenges, but it took proactive approach to deal with its volcanic geography and aging population. It is commonly noted that petroleum occurs almost exclusively within sedimentary rocks, Japan imports 78% of its oil consumption, 83% from the Middle East. The increased labor costs attributed to an aging population diminished the competitiveness of products made in Japan. In response to these challenges, Japan has strategically relocated its manufacturing capabilities close to target markets and only retained high value-added design and research activities in the home country. This strategic move enables Japan to capitalize on the labor markets in host countries and diversify the risks associated with its supply chains.
The European Union stands a miraculous achievement in aligning political and economic policies across its 27 member states. This supranational union provides a platform for resolving conflicts among its members, instead of otherwise.
Germany could concentrated capitals for rapid industrialization by leveraging its navigable waterways. Its world-renown manufacturing sectors manage to push high-quality products to global consumers. Germany has to fall back to European market in the era of Disorder, while Europe faces some simultaneous interlocked crises: currency, finance, banking, monetary policy, supply chains, inequity, migration, energy, demographics, consumptions, exports, imports, and regional conflicts.
France barely Europeanized its economy, it is positioned to potentially suffer the least and rebound strongly. Its formidable military allows for deployment to former French colonies to ensure the energy security. Observing closely, it remains to be seen whether France’s attempts to ascend will prove successful in this new era.
Let’s talk about the bear in the room, Russia. Its economy has deteriorated to heavily reliance on the energy export. The aftermath of Soviet Union’s collapse exposed Russia’s core economic zones to external threats trough the corridors of Baltic，Crimea, and Caucasus. Ongoing military activities in these regions continue to drain Russian resources. Compounded with aged population and low birth rate(1.42 children per women) resulting a net growth rate -0.39%. The situation is further exacerbated by the loss of 2 million people due to the Ukraine War, diseases, and migration. Russia is doomed.
The troubled South America
The South America is a hollow continent with most population concentrated in a series of escarpments along the coast line. The escarpment descends directly to the ocean, impeding the direct connections between the economic zones. This distinctive geographical has significantly curbed the development of South America.
The lack of economic connections has fostered the disunity of Brazil’s political systems. Oligarchs, often the descendants of conquistador, wiled significant influence and exert tight controls over their fiefdoms. The central government cannot achieve any national economic objectives without their supports. These misalignment of interests has further exacerbated economic inequality to an extreme degree. The corruption and culture of crime is structural. In many favelas, local mafia groups stepped in, replacing the government as the de facto providers of power, water and other public services.
Brazil is the largest soybean exporter in the world, contributing for 49.7% to the global market share. However, the tropical savanna, aka cerrado where soybeans are cultivated requires several years of lime treatment to deacidify the soil. Additionally, the cultivation process demands double or triple the amounts of fertilizer, pesticide, herbicide, and fungicide compared to the more favorable temperate-climate zones. Without the foreign capitals and access to the global market, this high-cost agriculture may face challenges in the fluctuating demand of the post-Order era.
Argentina was still haunted by the Perón’s political legacy despite of its geographical advantage and economic potentials.
Globalization boosts productivities, encourages communications, and mitigates the risks of conflicts. However, the United States, appears unwilling and/or unable to uphold the Order established after World War II. With rise of right-wing populist leaders, the policies of trade protection, anti-immigration are enacted. We are in the era of post-Order, and we are compelled to adapt to the emerging era of Disorder.