The celebrations marking the EU’s Nobel Peace Prize are more likely to commemorate Europe’s past rather than shape its future. Europeans may highlight the “European model” as a contrast to Asia, which they see as still riven by conflicts rooted in the colonial era and World War II. However, as power shifts from the Atlantic to the Pacific, Asian views will increasingly command attention. Asian demands for the re-balancing of global institutions will grow, and Asian views that the region’s own institutions have played an effective role in ensuring Asia’s peace will become louder.
Ever since the mid-19th century, the global political economy has been dominated by the West. But this was not always the case; in 1700, Asia’s share of global GDP was 57.6% and China alone accounted for 22.3% of it compared to Europe’s 25.3%. By 1870, Europe’s share had increased to 37.7% while China’s fell to 17.2% and the whole of Asia accounted for 36%. Europe benefited greatly from the industrial revolution and colonial expansion, while China, India and South East Asia suffered from internal wars, foreign interventions and domestic stagnation. Now, the re-emergence of China, India and South East Asia over the past 25 years reflects stable governments, outward looking economic policies and rapid urbanisation. The change has drawn the world’s attention to the changing global power equation.
By 2030, Asia will overtake the United States and Europe in terms of GDP, population size, military spending and technological investment. China alone is expected to reach 19.8% of global GDP by then, in contrast to Europe which will sink to 14.6% and the United States to 14.5%. This change is likely to lead to a shift of power away from the unipolar world of 2000, in which America had emerged at the end of the Cold War as the sole superpower, to one in which a number of major powers will influence global developments.
“Now, the re-emergence of China, India and South East Asia over the past 25 years reflects stable governments, outward looking economic policies and rapid urbanisation”
The United States, Europe and Japan, will be joined by China and India along with emerging economies such as Brazil, Indonesia, South Africa and Nigeria. Because of the sheer size of China and India, these emerging economies will form a second tier. All this will highlight the shift to a world increasingly dominated by non-Western powers, accentuating the already discernible changes that have occurred since the financial and economic crisis began in 2008.
This shift in global power will not mean, though, that western states will grow poorer. Their relative hard power will decline but the United States and Europe will still enjoy high standards of living, economic growth and relative social stability. Europe will have to deal with an aging population, but the U.S. enjoys a higher birth rate and will continue to draw educated entrepreneurs as migrants from around the world, especially from Latin America, if its immigration policies are maintained. That means the U.S. is likely to remain a technological leader and a centre of innovation.
America’s challenge will be to recognise that as its relative economic power declines, U.S. military dominance and global hegemony cannot be sustained. Despite budget constraints, the U.S. is likely to retain its military advantage over possible adversaries at least until 2025. Instead, the risk is that the U.S. will try to hang on to its pre-eminent role in the global governance institutions established after World War II, notably the United Nations Security Council, the International Monetary Fund (IMF) and the World Bank, rather than adopt new mechanisms which would allow rising powers to share responsibility for global leadership.
Reform of these institutions is currently proceeding at a snail’s pace. The imbalance in the IMF is a good example; not only do Germany, the United Kingdom and France each have a larger voting share than China, but so too do the Netherlands and Belgium when combined.
America and the Europeans might be more willing to share their leadership if they were to recognise the strength of their own soft power. It is the power of attraction generated by the culture and policies of the U.S. and Europe that draw followers and supporters from throughout our increasingly inter-connected world. Western hard power may indeed be in decline, but the influence of language, particularly English, along with Western ideas, norms and values will do much to shape the global outlook. Western music, popular culture, universities and football clubs will go on attracting audiences worldwide, exerting influence long after the powers that introduced them have faded.
“America and the Europeans might be more willing to share their leadership if they were to recognise the strength of their own soft power”
This ability to shape preferences and influence the way others see you is durable and slow burning. Although the Catholic Church’s followers are now mostly in Latin America, Africa and Asia, Europeans (and above all Italians) still dominate its leadership. Other examples range from music and the arts to higher education, where Western universities, particularly in the English-speaking world, retain a special place.
Not all Western influences are so positive. Although European integration is generally viewed favourably, the current European recession and the travails of the eurozone have drawn attention to the negative impact of a common currency when it embraces varying standards of productivity and competitiveness. In the area of monetary and fiscal policy, the voices that had been championing a common Asian currency are now silent.
Asia will find its own way in an increasingly inter-dependent world. In contrast to Europe, Asian regionalism is broader and more outward looking, emphasising flexibility, adaptability and diversity. While European observers may criticise the overlapping structures in Asia, such as the ASEAN-plus Three framework, the East Asian Summit and the Asia Pacific Economic Cooperation (APEC) forum, Asian analysts emphasise the need for the inclusive and consensual approach that has been taken in the region. The result is that Asia will adopt a distinctive approach and will not follow the European model where so much sovereignty is transferred to a supranational organisation like the European Union.
In its external relations, the EU has highlighted the role of elected democracies, the sanctity of individual political and civil rights, its support for human rights and the ‘doctrine’ of humanitarian intervention. This led earlier to EU sanctions on Myanmar and a restriction on meetings with Myanmar’s leaders, bans on arm sales to Indonesia and strong criticisms of China.
In Asia, confidence in the growth paradigms of states in the region has reinforced an approach resting on a technocratic approach to governance, the significance of social rights and obligations, a re-assertion of the principles of national sovereignty and non-interference, coupled with support for freer markets and stronger regional and international institutions. Although there was in years past a preference in some countries for strong authoritarian government, the emergence of democratic governments in states like Indonesia and South Korea has meant that there are tensions within Asian regional institutions as member states attempt to shape these institutions in line with their own particular model.
“In the next two decades, alongside the United States and Europe, rising powers such as China and India will increasingly seek to shape global institutions and the global discourse on the critical issues facing the world”
In the next two decades, alongside the United States and Europe, rising powers such as China and India will increasingly seek to shape global institutions and the global discourse on the critical issues facing the world. India will certainly seek a permanent seat on the UN Security Council, and there will be pressure from the emerging powers for a single permanent European seat to replace those of the United Kingdom and France now that the EU has a common foreign and security policy. There will also be mounting pressure from the rising powers for a greater share in the leadership of the global institutions for economic governance. Ever since 1945, the IMF and the World Bank have respectively been led by a European and by an American.
Just as global institutions will be influenced by the rise of Asia, Asia-Pacific states will have to adapt to the norms, values and practices of global society. Reform of the global governance institutions will have to occur so that they are more reflective of both the established and the rising powers. Europe can learn from the consensual approaches preferred in Asia, just as Asia can learn from Europe’s support for rules and strong institutions.
We all need to recognise that there are divergent norms and values present in international society and that those differences can sometimes lead to conflict. Inclusive global institutions could serve as agents of co-operation on a larger scale. That means the strengthening and broadening of global institutions so that they are representative of East and West is of critical importance.
In the 21st century, these global institutions need to derive their norms, values and practices from global society, not just from Atlantic or Asian perspectives. Instead of the victors of a war that ended almost 70 years ago shaping the world’s political and economic security, global institutions should be inclusive and should reflect the rising powers in terms of representation and the distribution of power. Only that can provide the basis of a new global consensus.