The COVID-19 pandemic disrupted the world in countless ways. Its fallout — impact on health, environment and the global economy — will last well into the decade. In fact, the dark shadow of COVID-19 could define the geopolitical and geoeconomic trajectory of the 21st century.
COVID-19 came into a world riven, once again, by great power competition.
On one side, behind the trade and technology wars between the US and China, seemed to lie a deeper clash: a struggle of different ideologies and value systems competing for dominance. Yet on the other, the lexicon of this clash was strangely transactional — the lines between geopolitics and deal-making worn thin by “the art of the deal.”
2020 may have seen a confused, divided world, but it did sign off with three cliffhangers: Biden was declared set to enter the White House; China and Europe struck an investment agreement; and UK and EU managed to agree on a deal over Brexit.
Today, all countries are looking at themselves as they struggle to recover from COVID-19. There are those who think they can see the writing on the wall. That a post-COVID world may well see China become the world’s biggest economic player, far sooner than thought earlier.
Putting on the pressure, President Xi is not averse to using strong-arm tactics in the technology war by threatening German manufacturers based in China. Markets lure, economic revival beckons and an agreement that was seven years in the making closes the COVID-19 year.
For a while there may have been strategic competition between China and the OECD. What must not be forgotten is the equally strong, if not stronger, trade competition between the EU and the US.
A weakened transatlantic alliance gives Europe room to reassert its own path — their argument that the EU-China investment agreement only goes as far as what Trump had already signed off in his bilateral Phase I deal with China.
Post-Brexit, what are the likely shifts in decision-making among world powers?
There are few visible changes. Building new relations between the UK and the European Union will take some time. The Brexit signing will have its impact slowly, but surely — in many ways the lockdowns have given a grace period for both sides to ease themselves into the deal.
The services sector in Europe and UK will have to remodel itself. Indian investments in the UK will feel the pain of the end of the common market.
UK seeks to emerge as a global player in its own right and keen to push its own bilateral agreements/trade deals. There will be separate negotiations taking place between the UK and China.
While China continues to be aggressive, the world is looking forward to the Biden administration. How can one assess this?
Even as Biden seeks to rebuild old world alliances, he will be hamstrung by the need to first knit a divided US together before he stitches its torn alliances. Far from being the cause of the disruption, Trump was really a symptom. The underlying forces that unleashed Trump still need to be tackled.
So the world will continue seeing an inward focused America battling COVID-19, getting its economy back on rails, while Trumpism keeps finding resonance amongst many Americans. China will continue its aggressive posturing beyond its shores and borders as President Xi imagines he has a tailor-made space to vent abroad, even as China grapples with its sizeable domestic issues.