Lessons from the Russian Invasion of Ukraine in 2022 The West’s Opportunity to Reset the World Order

The global liberal order, having shaped the world since the middle of the 20th century, is failing to address the most important external challenges of our times, issues like climate change, digitisation, and global income inequality. Indeed globalisation, which is at the core of the liberal order, is credited with creating unprecedented wealth for nations while transferring jobs away from working and middle class across the West, which were not replaced by successive governments, fuelling a national populist backlash against that order. Further, the acceptance of China into the order has failed to lead it to shift its model to a democratic one and instead has given rise to an illiberal challenger to the incumbent democracies that helped its ascent. Finally, the disengagement of the United States from international leadership in favour of a National Populist ‘America First’ approach threatened the West’s pre-eminence in rules-based multilateralism.

Recently, however, the events surrounding Russia’s invasion of Ukraine point to a revitalisation of the failing order: the West reunited for a common purpose, taking coordinated actions across policy, economics, and defense in the face of a shared (and global threat), and working through existing multi-lateral institutions like NATO. Similarly, the alignment of liberal democracies to protect the national sovereignty of a country and the democratic wishes of its people also seems reminiscent of a time when the liberal international order was delivering peace, prosperity, and freedom to the world. On the other hand, however, current events also highlight the cracks in the face of the order: a structurally disunited Europe with the UK out of the union, renewed land war in Europe launched by a revisionist nuclear power, the continued statements of support Russia enjoys from China (albeit less strong) as the world’s second superpower, and India as a future power looking to continue its non-aligned policy.

Russia’s invasion of Ukraine therefore is clearly a critical event impacting the global order and the shape of the world to come. However, it remains to be seen whether it is the crucible of the current order’s reinvention or a catalyst for its further demise. This will depend on how the crisis continues to unfold and how it will be resolved (eventually), which in turn depends on the choices of the key players. This month’s Sign of the Times looks at the implications for the key players.

The Decisions Shaping the Path to a (Renewed) Global Order

The narrative that the West is weak and the world order in disarray has been the prevailing one of the past many decades. The pandemic reinforced the message. This time last year marked the first anniversary of the coronavirus pandemic ¹ and the world’s major countries were in various states of lockdown in response to their second and third waves of infection. The previous year, 2020, had exposed a fundamental lack of resilience of many of the world’s leading countries, which suffered unprecedented social, economic, and even political dislocations in the face of often ineffective and insufficient responses to the pandemic, some face was saved by vaccine rollouts despite millions of lives lost already. More importantly, the year had exposed a fundamental lack of coordination in the face of a global threat: international institutions like the World Health Organisations failed to provide an effective response, global supply chains were disrupted by waves of national lockdowns, countries competed to secure limited supplies of medical equipment and vaccines, national pride was stoked to celebrate being a few weeks ahead of neighbours in vaccine roll-out, and globalisation itself seemed to grind to a halt with restrictions on international travel and a slowdown in trade.

What a difference a year makes. Fast forward the tape by a year and the world looks much changed: Russia’s Is the world reset to pre-World War I with Europe divided, the US helping but not willing to put boots on the ground, an aggressor with territorial ambitions and a rising Asian power? Or is this the perfect storm that galvanises the world to reject repeating the violent past and unite to transition to a more peaceful, prosperous, and free world? invasion of Ukraine galvanised the West into action, the West lead a large number of countries in aligning to speak up against Russia’s aggression and coordinated an unprecedented package of sanctions², the EU opened its doors to nearly four million Ukrainian refugees in the first month, and NATO armed Ukraine and committed to rearming itself after decades of declining defence spending. Compared to last year, the world in other words has become more coordinated, united in action, resilient, and compassionate in the face of a brutal war and an unfolding humanitarian disaster. While this renewed unity is of course simply a snapshot in time, and an event driven one as well, this holds out the potential to design a new global world order along lines that may yet be underpinned by liberal values.

Potential long-term implications aside, it seems increasingly clear that the world has entered a phase of renewed great power competition, with both a strengthening China and a resurgent Russia, which refuses to accept the reality of its demotion to a regional power, and still seeks to hammer nails into the coffin of the US led unipolar world of a generation ago.

As history shows, and as examined in a previous Sign of the Times, ‘American Power: Mapping its Rise and Calculating its Fall (and Return)’, ³ every new phase in the rise of great powers, is ushered in by a series of global power shifts, as nations, and allied groups, rise and fall based on the accumulation of economic, military, political, social, and technological power. Looking across these components, there are four major power blocs that on account of their scale and/or their growth have the potential to set the rules of engagement for the coming world order: the US, China, the EU, and India.⁴

These power blocs will have an outsized role in shaping the institutions and rules of the next world order and their decisions in the current crisis will be critical in shaping the trajectory of the world through it. Additionally given the geographic location and security focus on Russia’s invasion of Ukraine, NATO, as the fifth power bloc, has a key role to play in shaping the resolution and, more importantly, the aftermath of the crisis.

One month into the war in Ukraine, these five power blocs find themselves at distinct crossroads, and the decisions they make across multiple dimensions will determine not only their own direction of travel in the short-term, but that of the wider world over the medium to long term.

1.United States: Lead the World vs. Fall Back to America First

“We will repair our alliances and engage with the world once again, not to meet yesterday’s challenges, but todays and tomorrow’s. American leadership must meet this new moment of advancing authoritarianism, including the growing ambitions of China to rival the United States and the determination of Russia to damage and disrupt our democracy.” US President Joe Biden, February 2021

Context. While the unipolar world at the turn of the century is clearly a thing of the past, the liberal international order can endure based on the complex network of rules, institutions, and partnerships spread across global and regional security, economic, and political realms. This however will require America to continue to support this network as a leader and first among equals, a role that its own president called into question just one administration ago⁵ and which remains an increasingly political partisanship question in the context of the continuing strength of populist illiberalism in the US.

America: Indicators of the Direction and Decision Paths

Current Trendline. The Biden Administration has made it clear from the outset that it intends America to resume its leadership position in the world, but it is unclear whether it can build the political capital at home to allow it to do so. In the absence of sustained economic wins that create prosperity for a wide spectrum of the American population, Democrats are unlikely the secure the electoral wins required for a clear mandate to devote US resources aboard.

2. European Union: Engage vs. Isolate Russia

“This crisis is changing Europe. But Russia has also reached a crossroads. The actions of the Kremlin are severely damaging the long-term interests of Russia and its people … There is another Russia besides Putin’s tanks. And we extend our hand of friendship to this other Russia. Be assured, they have our support.” EU Commission President Ursula von der Leyen, March 2022

Context. It is clear that the most likely resolution of the current war will not by miliary victory or defeat but by negotiated settlement. The EU, with its geographic and economic ties to Russia, has not only a potentially important role to play in the process but an outsized interest in the eventual outcome too. While the EU aims to swiftly reduce its dependence on Russian gas, which represents 40% of total consumption, Russia remains a major trading partner who buys over US$100bn in goods from the EU, and it shares a land border with four EU members. While Russia is of course currently under the strictest of sanctions, the EU will ultimately need to decide its policy toward Russia post the current crisis – will it draw a political and economic Iron Curtain across its borders, or will it seek some form of rapprochement with Russia without falling back into the trap of dependence from which it is now trying to extricate itself.

EU: Indicators of the Direction and Decision Paths

Current Trendline. Russia’s aggression has discredited the wing of the EU which favoured conciliation over confrontation or at least thought engagement would lead to liberalism, and its remaining proponents have come under significant pressure in their own countries, leaving little room for rapprochement in the current climate. However, it remains to be seen whether the EU or some of its leading member states can develop a roadmap for some form of ‘normalisation’ of relations with Russia over the long-term, with a more effective means of encouraging ongoing peaceful engagement, once a a peace deal has been done.

3. China: Step Aside vs. Prop up Russia

“No matter how perilous the international landscape, we will maintain our strategic focus and promote the development of comprehensive China-Russia partnership in the new era.”

Chinese Foreign Minister Wang Yi, 7 March 2022

“China is not a party to the crisis, still less wants to be affected by the sanctions.”

Chinese Foreign Minister Wang Yi, 15 March 2022

Context. For China, the current crisis has only downsides: it hurts global trade, it hits its manufacturing sector with high energy prices, and it impacts its US$4 trillion Belt and Road Initiative as land routes to Europe are affected by the war. Having publicly committed to Russia as its strategic ally, China’s challenge lies in maintaining its partnership with Russia without aggravating its relations with the West, while needing to reconcile the fact that China’s core foreign policy principles of sovereignty, territorial integrity, and non-interference have been violated by Russia’s actions. While China clearly sees the West as a competitor and threat and can imagine itself on the receiving end of the Quad with NATO expansion, its exports to the EU and United States totalled over US$1 trillion compared to US$70 billion to Russia in 2021, and these provide some constraints on China’s enthusiasm for supporting Russia.

China: Indicators of the Direction and Decision Paths

Current Trendline. While its rhetoric places China firmly in the Russia camp, its actions reveal its inclination to avoid being drawn into adversity with the West at a time not of its choosing and with no clear upside for China. For example, while it has loudly criticised western sanctions on Russia as illegal, China has also been at pains to state that it is not circumventing these sanctions.

4. India: Join the West vs. Walk the Tightrope

“Prime Minister reiterated his long-standing conviction that the differences between Russia and the NATO group can only be resolved through honest and sincere dialogue. Prime Minister appealed for an immediate cessation of violence and called for concerted efforts from all sides to return to the path of diplomatic negotiations and dialogue.” Prime Minister Narendra Modi and Vladimir Putin -Transcript of telephone call, Indian Government Press Release, Feb 2022

Context. As a long-term partner of Russia stretching back to post-Independence and through the original Cold War, India has not overtly condemned Putin’s invasion and has abstained from the U.N. resolutions against Russia. Further, India to date has refused to join the sanction regime against Russia while has proactively signalled its trading and relationship priorities by signing new energy supply deals with Moscow. India’s refusal to take sides in the current conflict has required it to chart a a very narrow course, calling for a cessation of violence without condemning the invasion that is causing it in the first place. However, given the increasing convergence between India and Western countries on priorities in the Indo-Pacific, including the perceived need to balance the growing influence of China, calls by Western leaders for India have been ‘understanding’ and soft at best.

India: Indicators of the Direction and Decision Paths

Current Trendline. Should the geopolitical situation deteriorate into a new Cold War and were India forced to choose, it is unlikely that it will throw its lot in with two authoritarian regimes that flagrantly violate human right and supress freedom. However, ‘choosing’ the West and the US in particular will require overcoming a very real trust deficit in India, which has been built up over decades of less than total support by the US, which was often seen to favour India’s rival Pakistan, particular in arming Pakistan with weapons used in the wars between the two. India has been moving in that direction with its massive international diaspora and trade of course, but the final steps remain to be seen.

5. NATO: Reinvention vs. Retrenchment

“NATO’s core task is to protect and defend all Allies. In recent years, we have implemented the biggest reinforcement of our collective defence in a generation. With particular focus on the eastern flank.”

NATO General Secretary Jens Stoltenberg, March 31st, 2022

“We face a fundamentally changed security environment. Where authoritarian powers are increasingly prepared to use force to get their way. So, I expect we will also address the role of China in this crisis.”

NATO General Secretary Jens Stoltenberg, March 23rd, 2022

Context. NATO’s role has evolved significantly during its 70-year history. Essentially founded as a security umbrella to protect Europe from a Soviet invasion, NATO’s first 30 years were spent as a defensive alliance backed by the nuclear arsenals of its leading members. Indeed, no military operations were conducted by NATO during the Cold War. The demise of the Soviet Union and the threat of nuclear war opened possibilities for conducing military operations, firstly in Europe (Bosnia 1992-2004, Kosovo 1999-), and later further afield (Afghanistan 2001-2014, Red Sea/Gulf of Aden 2009-16). With Russia’s resurgence as a potential nuclear and conventional threat, NATO will need to consider whether retrenches into a highly European security alliance to defend against Russia or continues down the path of evolution into a global organisation focusing on an array of 21st multi-dimensional threats.

NATO: Indicators of the Direction and Decision Paths

Current Trendline. The rhetoric at the recently concluded NATO summit in Madrid indicates their intentions to both strengthen the European core of the alliance in response to the current crisis and to expand the remit with deeper political consultation and coordination, while also expanding the alliance’s intentions to combat major non-military security threats, such as climate change.

One cannot help but notice that neither of the two parties who are actually fighting the current war are included in the list above. While they are of course the ultimate arbiters of how long the current conflict will last, the ability of Russia and Ukraine to shape the future world order beyond the conflict is likely to be limited, but nevertheless, this war is a world level catalyst and Ukraine’s future position has been elevated given its response to aggression, just as Russia’s has been albeit for the wrong reasons.

While Russia will not have a seat at the table as a rule-maker for the next world order, it has demonstrated that it won’t be a simple rule taker, either. Rather, much like climate change and pandemics, Russia, under Putin, seems poised to to play the role of a systemic risk around which the new world order will need to be forged.In Ukraine’s case, its near-term options are significantly constrained: given Russia’s resource and military superiority, the chances of Ukrainian military victory are low, pointing to a negotiated settlement as the most likely outcome. The decision for it therefore seems to be one of timing, trading off further destruction of its cities and deaths of its people for, one hopes, a more palatable peace deal. While the deal is of critical importance to Ukraine, will capture the interest of the world, and will be a critical plank in de-escalation, the deal is less likely to change the course of geopolitics. However, the unity it has inspired, has the potential to do so.

Russia on the other hand has perhaps the widest range of options open to it of all countries: Putin is the only person in the world who can choose to end the the current war with the stroke of a pen or to condemn the region to countless further deaths, and years of hardship and economic deprivation. From the perspective of the future world order, however, the country’s die has been cast. Putin’s aggression has set him beyond the pale among international leaders and, in the absence of regime change, has cast Russia as a pariah in the global order for some time to come. Even a peace deal that restores the status quo ante bellum, (which may be unacceptable to Russia) will not undo the 20,000 deaths and counting, or un-bomb the US$500bn in property damage.

Of course, regardless of the extent of the West’s ostracism, Russia will not become an outsized North Korea. It is a nuclear power, the owner of the world’s largest gas reserve, and a country that has proven adept at wielding economic and military power and influence not just on its borders, but further afield in places like Syria and Libya too, where it has largely outmanoeuvred the West. While Russia will not have a seat at the table as a rule-maker for next world order, it has demonstrated that it won’t be a simple rule taker, either. Rather, much like climate change and pandemics, under the leadership of Putin, Russia seems poised to to play the role of a systemic risk around which the new world order will need to be forged.

The Emerging World Order: Three Scenarios

The Boundaries for the Future Order

The shape of the emerging world order will be determined by the choices of the major power blocs: the US, the EU, China, and over time, India. This world order can take on a wide variety of shapes given that each blocs’ own freedom to manoeuvre allows for a number of potential political, economic, and security constellations. However, there are a number of ‘certainties’ that are likely to hold across all potential future world scenarios, and these collectively form the boundary conditions of any future world scenario:

• The US and China will be competing superpowers. While their alliances and the superpower status of their allies may change over time, the coming world order will be defined by US-Chinese superpower rivalry.
• Interdependencies temper competition and encourage cooperation. Globalisation has created deeper and deeper interdependencies between countries, necessitating greater and greater collaboration to solve what are now shared problems.
• Global challenges require global solutions. The global nature of the world’s biggest challenges necessitates global solutions, which in turn requires mechanisms for consensus building and coordinated action.
• Need for rules-based order acknowledged by all. Both the US and China recognise the value and necessity of a rules-based order to manage global challenges and will seek to establish themselves as the rules-makers of an order that works to their respective advantage.
• Competition between autocracies and democracies will define the orders. China’s rejection of the political dimension of the current order (human rights, humanitarian intervention, and democracy promotion), ensure that these issues will be a battleground in the new order.
• Domination of one superpower over another seems infeasible. It is highly unlikely that either superpower will be able to dominate the other, and therefore equally unlikely that either would cede global leadership to the other.

Three Scenarios for the World Order

In the absence of some existential level risk event, the most likely scenarios include the evolution of the existing liberal order (either through reform or decay), potentially alongside an emerging competing order with which it co-exists. The extremes therefore lie between a reinvented multi-polar world order and a new Cold War.

The original Cold War was ideological in nature and focused largely on security and defense in a decades long nuclear and conventional arms race. Despite the potential for the lines of a future cold war between liberal democracies and authoritarian regimes it would not be ideological, with Russia and China embracing in a marriage of convenience rather than a deep commitment to the ‘political philosophy of authoritarianism.’ A future cold war would therefore be both more subtle but also more comprehensive, combining security concerns with competition across technology, trade and investment and development finance.

The potential scenarios for the world therefore include the following:

1. Revitalisation and Reinvention of the Liberal World Order. In this scenario, the sustained and coordinated efforts of the West exacts too heavy a price for Russia to continue the war, with China abandoning its costly partnership with Putin to protect its own economic interests. The success in war would then be followed up by success in peace, with international and regional multi-lateral institutions galvanised to rebuild and strengthen existing global economic and political structures. Institutions like NATO would be able to broaden their mandate and scope and institutions like the UN, whose origins lie in the peace after World War II and through the Cold War, are reformed to ensure their continued relevance, becoming vehicles for the world to collaborate on issues like climate change, development, and space exploration. Within this strengthened framework, progress and even breakthroughs on global issues once again become the positive thrust of the world’s advancement.

2. Descent into Renewed Cold War. If Russia demonstrates significant resilience to Western sanctions and democratic nations prove ineffective at escalating further (with perhaps Russia’s nuclear threats playing a role in that calculation), a quite different scenario emerges. China, seeing a path to successfully increasing global power, with Taiwan clearly in its sights, could see merit in throwing its weight behind Russia. This would likely trigger a new Cold War, that pits China and Russia against the West, with both sides actively courting non-aligned and developing countries with economic and diplomatic ties. The ultimate failure to hold Russia to account for its invasion would effectively validate military aggression as a legitimate tool of policy and dispute resolution. In this scenario, the world would go on to fail to be led to success and therefore not mustering the necessary cooperation and compromises to solve other major global issues, leading to the Sustainable Development Goals and global net zero being at risk if not failing to be achieved, with potentially catastrophic consequences for the world.

3. Geopolitical Purgatory - Awaiting a More Decisive Event. In a scenario where there are victory and losses on both sides without a decisive outcome, the bloody war in Ukraine risks being the beginning of a series of security risks to test the resolve of the world to move beyond war. Until the emergence of a geopolitical security risk that rises to the level of a ‘strategic interest’ demanding decisive action of the US, NATO, or China, which will ultimately result in one of the scenarios above prevailing, the world is left to wander aimlessly without a cause celebre to unite behind. Climate change, despite its catastrophic consequences, is unlikely to rise to be that cause. This gap between extreme scenarios, a suspended cold war, or a “Cold Standoff” perhaps, would see the nations take sides, split between superpower camps, or stay neutral, all with little consequence. The transition to the other side with a more sustainable world order would be long and risky with instability piling up and room for ‘bad-actors’ to play out their interests.

Conclusion

Looking at the three scenarios above, revitalisation and reinvention of the liberal world order is clearly the one that maximises global peace, prosperity, and freedom, making its realisation not just a pragmatic imperative but a moral one too for the West. Realising this scenario requires a sustained and coordinated effort by the West, regardless of who is in the White House or heading other NATO countries, and includes the following steps, among others:

• Fully developing an arsenal of economic sanctions and measures aimed at creating steep and scalable disincentives and penalties for aggression

• Re-engaging China in a mix of cooperation, competition and likely, containment as an allied effort between the US, EU, and India, learning the lessons of the post-Cold War pitfalls of failing to fully engage and address Russia’s needs (they may never have been addressable of course), loosening its attachment to Russia

• Planning for Russia, under Putin, as a force of nature whose potential needs to be understood much as the world seeks to understand and plan for climate change, while determining the levers of collaboration that may open the way for a more productive relationship without creating strategic dependency this time

• Developing a more comprehensive foreign policy for the developing world that includes investment and security, targeting Africa and Latin America, including creating an allied fund to exert economic influence and offer alternatives to engaging with China to potential allies across the developing world

• Expanding the definition of the ”West” from Caucasian advanced industrialised nations plus Japan, to include a broader range of democratic countries like India and South Africa

• Reassessing how to secure the support of other authoritarian regional powers such as Turkey and Saudi Arabia as security allies

• Recognising the rise of Asia and the power of China in the region and creating a NATO in the East, beginning with the Quad as its base.

This war has driven home the message that the architects of the next world order will need to develop constructive engagement strategies with competitors who do not share their liberal and democratic values. At the end of the Cold War, the West, led by America, sought to reshape the liberal order into an agent of neoliberal globalisation, integrating China and Russia economically in the expectation that political liberalisation would follow economic liberalisations given sufficient economic prosperity. Following this approach, the West has funded the development of strategic global and regional competitors who, two decades later, are certainly richer but also less liberal than they were at the beginning of the engagement.

So, shared values have proven to be neither the starting point nor the end point of the liberal world order (whose liberalism has been confined almost exclusively to the economic sphere). In fact, liberal values alone seem incapable of binding even nations who share these self-same values to the West (as demonstrated by India’s position based on the debts of history it feels it owes Russia), and so any successful new order will likely be rules based and aspire to be values led. This is the fundamental challenge facing the West, and one it will need to successfully address no matter how favourable the outcome of any peace deal with Russia in this war may end up being.

Stepping back, the idea that the West is hopelessly weak is a fallacy that Putin in invading Ukraine has exposed. However, this war is not over, and the verdict is still therefore not complete. What is clear is that the West can shape the new world order if it is united. If it does, the more broadly defined ‘West’ has the prize of setting the rules of engagement in the transition to a more sustainable digital world. However, it would need China’s acquiescence to do so since by 2030 China is widely expected to overtake America, the anchor of the West, as the biggest economy in the world. This implies China is an ally or a neutral party in the global coalition of the West. Two other risks need to be managed, the first is Russia as a disruptive force and, perhaps most important is America’s fight with its own populists who may yet prevail over American aspirations to be the ‘leader of the free world’ with a more predatory, transactional model of America. Ultimately, the leader of the next world order will not only be followed for their ability to set geopolitical rules of engagement, but for their ability to create a more prosperous world, and as such will likely be the inventor and exploiter of the breakthroughs in energy and resources that the next civilisation is built on, and the competition is on for that and given the scale of the challenges and opportunities, the bet of the West is that big bold bets and risk taking are the purview of the free.

Notes