Milestones of The World Development 2022-2023

Security has become a major concern of world powers. The EU countries increase their defense expenses, NATO expanses and introduces new members as Chinese and Russian power grow, while certain countries, such as Hungary, Bulgaria, Turkey and to some extent Romania seem not to support the general Western course of actions.

The conception of the war conduct has drastically changed. The paradigm of the war pulls out previously recognized as basis weapons, equipment and human resources. A rapid development of technologies and their rapid integration into the defense sector made innovations the most important geostrategic factor shaping the international security environment and the global balance of power. The weapons supplies made by Western countries to Ukraine being one of the causes of the Ukrainian conflict, the technologies might be considered as even more important factor making it possible to resist hybrid forms of attacks. Maxar Technologies and Capella Space corporations with their “private space” provided Ukrainian army with special intelligence programs and images, Google Maps tracked and disclosed information on Russian troops movements, Microsoft was engaged in the transfer of the Ukrainian government’s critical infrastructure to cloud servers to detect cyberattacks and protect relevant data, such platforms as Twitter and YouTube were engaged in information attacks – these are just several examples of the role of technologies in ensuring security. It is impossible today to resist hybrid attacks without a help of technological giants. Presently the critical infrastructure of companies has become a protective shield both on earth and in space. The techno holding’s competition, having changed from purely economic to political one, made them become the most important guarantors of international peace and security.

Hybrid warfare becomes a new form of interstate confrontation. There is a growing confrontation in cyberspace, a great increase in the number and type of attacks on civil and state infrastructures.

In 2022, the number of cyberattacks increased by about 20% in Russia, the number
of successful attacks at the websites of state institutions increased by more than 2 times, there were numerous cases of massive data leaks. As a result, modern realities have increased the relevance and importance of information security and made cybersecurity the main tool for ensuring the production sustainability. Over the past year, the information security market in Russia has increased by about 15-20%.

The complication of the world geopolitical situation, world forces reorientation, the economic sanctions imposed against Russia and energy flows bans have created conditions for the displacement of global economic centers. The global security crisis has finally consolidated the emerging trend of strengthening forces in the East. The Asia-Pacific region (APR) is becoming a new economic and military center. These changes are the natural consequences of its exceptional geopolitical significance, such as leading role in global economic activity, high technologies (including aerospace industry), a powerful military potential and numerous human resources. Over the past decade, the Asia-Pacific region has become an industrial and military center, overtaking Western countries in its potential.

The countries of the Middle East continue to develop. Saudi Arabia, the UAE and Qatar, being the strongest economies of the region, show astonishing GDP growth rates. The UAE becomes a new international trade and business hub and intensifies military cooperation with Russia and China, while in the same time withdrawing from the United Naval Forces led by the United States. Saudi Arabia is presently building a global logistics center that will increase the efficiency of supply chains for companies in the industrial, energy, petrochemical sectors. Iranian goods export to Russia exceeds by 30% the figures of the past year.

The countries of the Middle East, being the major petroleum exporters, play a significant role in the world economy and set new trends. In new world realities, trying to follow the changing world architecture, they are trying to join international structures established by China and Russia as an alternative to their Western counterparts. Pursuant to the last BRICS report, more than 20 countries have applied for or expressed their desire to join the union, among them: Argentina, Mexico, Iran, Saudi Arabia, the UAE, Indonesia and others. The efforts made by world economic leaders in acceding to the union only confirms the fact that in the near future BRICS can become the most powerful international coalition capable of creating a new world architecture.

The Russian Federation

Oil and gas exports had been a basis for Russia-West cooperation for a long time. Sanctions imposed by a number of Western countries (EU members, USA, Canada, Australia, Japan), having failed to produce the desired "shock" effect on the Russian economy, accelerated the reorientation from the West to the East. Logistics, trade, and financial mechanisms are being formed now to build a new Eastern policy and make Russian companies turn towards China, India, the Middle East and Turkey and the ASEAN countries.

Further, Russia continues to be the world's largest exporter of wheat and forestry products, as well as a source of strategic resources such as nickel, cobalt and platinum.

The growth of Russian-Chinese trade has become one of the key trends of 2022. Russia changed global oil and coal supplies by redirecting them to China, while Chinese companies, taking the advantage of the Western countries’ withdrawal from the Russian energy market, increased their export demands. By the end of 2022 the trade volume between China and Russia reached $190 billion, which is an increase of 29% compared to 2021. Chinese exports of goods to Russia increased by 12.8% to $76.1 billion, and imports from Russia increased by 43.4% to $114.1 billion. This is the most significant growth among the main trade partners of Beijing, exceeding by 49 times the growth of China-US trade volume.

The markets change caused by the reorientation of the Russian economy and the logical shift of economic centers allowed Russia to minimize the negative effect of the sanctions imposed. Kazakhstan assumed the role of a trade and economic bridge between Russia and the West
and became the main transit corridor among the states. The country's economy was also supported by India, China, the countries of the Middle East and Asia, such as Armenia, Kyrgyzstan, Tajikistan and Uzbekistan. For example, the UAE and Saudi Arabia, which are the largest oil exporters in the OPEC, strictly abide by the policy to limit oil production, which had been agreed with Russia. Companies from these countries have begun to transport Russian oil by sea.

The concept of the foreign policy of the Russian Federation, published in March 2023, defined the main vectors of the country's development in the context of the change of world architecture and Russia's turn from West to East. Russia continues to promote polycentric world, while the international cooperation being the key national interests. The existing security architecture and world order based on the UN principles demonstrates its failure. A new world order will be based on now strengthening international organizations, such as BRICS.

In recent months, more than 20 countries have expressed a desire to join the coalition of Russia, China, India, Brazil and South Africa. Candidates are attracted by the economic potential of the organization, stable domestic institutions, such as - the New Development Bank - which is considered to be an alternative to the International Monetary Fund. In the near future, the BRICS countries are expected to introduce their own currency, which will largely change the balance of power within the international monetary system. These measures are expected to weaken the dollar and allow the participating countries to achieve monetary and financial sovereignty.

To respond to the strengthening coalition with Russia and China at the head, the Quadrilateral Security Dialogue (QUAD) was established, consisting of Australia, India, USA and Japan. QUAD is traditionally considered as an anti-Chinese coalition. India, being a member state of both BRICS and QUAD, ably lobbies its own interest and uses the latter as a refraining element for China. However, it must be stated that the economic and political influence of the BRICS in the world continues to grow, and in the near future the organization may become the most powerful international coalition that will take the lead in building a new world architecture.

• Sanctions imposed by the United States and European Union countries accelerated the reorientation of the Russian economy from the West to the East.

• Russia remains the world's largest exporter of wheat, forestry products, nickel, cobalt and platinum.

• Russia is strengthening international cooperation with China, India and the countries of the Middle East. Authority of international unions with the participation of the Russian Federation is growing, the expansion of BRICS is expected.

The USA

For last 80 years the US government has made numerous attempts to interfere with the internal affairs of other states, both in military and economic spheres. According to the US National Security Strategy 2022 Washington shapes an international order based on its own interests, values and goals, which is allegedly conceived to protect the Americans and their rights.

The United States, together with the forces of NATO, the United Nations and various coalitions, has participated in many military conflicts in the Middle East and North African regions – in Afghanistan, Yemen, Syria, Libya and Iraq. "Fight against terrorism" or “need for democratic changes” have always been listed as official reasons for the launch of operations coupled with interference in internal affairs of other states. However, such operations have never brought peace.

In Europe Washington has traditionally been professional at playing off with states through intergovernmental military alliances. For example, America constantly clashes Serbia and Kosovo, which results in armed fights. However, the major interest of the US in Europe is doubtlessly Donbas, which might be proved by the amount of military and humanitarian assistance to Ukraine, amounting to more than $ 75 billion. At the same time, the United States actively encourages Ukraine's desire to join the North Atlantic Alliance. In July 2023 a summit will take place, at which a candidate country can be assigned a unique status in the structures of the Western partners.

The United States obviously pays special attention to the military alliances and to the expansion of the military contingent to other countries. Maintaining and strengthening cooperation with countries within military blocs is critically important for the United States, since in this way not only military presence and subsequent intelligence are carried out, but also instruments of political and economic influence on the target region are created.

Traditionally the US uses NATO to perform such activities. Apart from NATO the United States interacts with countries around the world through various partnership programs. For example, with Egypt, Israel and Tunisia – through the "Mediterranean Dialogue", with the UAE, Bahrain and Kuwait – through the "Istanbul Cooperation Initiative".

Pursuant to the NATO strategic conception, the Russian Federation is considered as the main geopolitical rival. Although this document also provides that NATO does not pose a threat to Russia, the geography of expansion, as well as the deployment of military activities suggest quite the opposite. The ongoing military exercises show the NATO’s intention to increase its military presence in countries bordering Russia by land (Baltic states and Poland), in the Arctic (Finland and Norway), as well as on the Black Sea.

Turkey helps NATO to maintain its presence in the Black Sea region. Despite the fact that Turkey has one of the most powerful armies in the region, it opens the doors for NATO military base, where also nuclear weapons are allegedly stored. Although US and Turkey cooperate closely within the NATO framework, the United States negative feedback on Turkey's attempts to have its own independent foreign and domestic policy is more than apparent. For example, the Interior Minister of the Republic of Turkey accused the United States of cooperating with the Kurdistan Workers' Party and said he knew "who was behind the terrorist attacks" in November 2022, pointing at the United States. Earlier, Turkey also blocked Finland and Sweden from joining the alliance because of their support for the PKK.

Apart from the mentioned alliances, official Washington participates in such Asia-Pacific alliances as AUKUS, which, in addition to the United States, includes Australia and the United Kingdom and QUAD with Australia, India and Japan. Both alliances are aimed at countering China and North Korea. At the same time the United States cooperates now more often with India through QUAD, pursuing attempts to set it up against China, and then the rest of the BRICS partners.

The United States attempts to opt countries for its own interests, which is served as "democratization" and "upholding human rights." US National Security Strategy of 2022 clearly provides for their “openness” to conduct a "dialogue" with the foreigners in order to promote "opposition to authoritarian regimes." However, in most cases this American candor does not have peaceful intentions, the purpose is to suppress the influence of competing countries and to combat dissidence.

These processes of "Westernization" are implemented with the help of various foundations, non-profit organizations, social programs and grants. However, apart from the officially declared missions, such organization constantly contribute to the drastic change of national ideas, values, conceal the truth and disseminate the false, discredit local authorities. All this results in anti-government rallies and speeches, strong opposition emerging. All of the above actions lead to the unstable internal political situation.

A striking example of such "democratization" activities might be the "Arab Spring", which is the series of "color revolutions" and coups performed under auspices of the US, including the Euromaidan, which later turned into a conflict between Russia and Ukraine in Donbas.

There are still plenty of points on the world map where the US is trying to undermine state regimes, Russia and China included. Here are the results of such attempts: Russia and Ukraine, Kosovo and Serbia, China and Taiwan. It could be anticipated that similar conflicts heated by the USA might emerge also in Russia – CIS countries (most likely with Kazakhstan and Belarus), China (Xinjiang Uygur Autonomous Region).

The US dollar has become a geopolitical weapon which helps Washington to intervene in the international economic activities of competing countries.

It is obvious that Russia's military operation in Donbas has become one of the turning points in the international economy, provoking a huge number of financial restrictions against Moscow and arrests of its foreign financial assets. Certain prerequisites of rethinking existing economic world order emerged though much earlier. Since the introduction of unilateral economic sanctions against Iran, China, Russia, Venezuela and other countries, the United States has actually declared itself an economic hegemon, dictating its terms to the whole world.

Another factor of distrust to the US currency is the constant growth of US government debt. By the end of 2022 it amounted to $31.4 trillion, which is 123% of GDP. At the same time,
45% of the public debt is external and creditor countries need to assess the risks of investments attentively. As a result, many countries are prone to reconsider economic relations with the United States, predict the consequences of using the American currency in international settlements and gradually abandon it. And these points are not groundless, for example, the Minister of Justice of Iran at St. Petersburg International Legal Forum proposed to create an "anti-sanctions" club,
in which an analogue of the SWIFT system would be present, as well as to make transactions in national currencies.

The initiative of "dedollarization" stems from the BRICS members, which discuss currently the possibility of switching to international transitions in national currencies. Reducing reliance on US dollar may also have regard to BRICS candidate members in the coming years, which will doubtlessly pose serious problems to the US economy, among which inflation raise.

The Chinese yuan therefore might take the place of the American dollar. Beijing has a completely different approach to making partnership with other countries. Instead of forcefully interfering in the internal affairs of developing countries, China invests in their economies, thereby increasing the loyalty of these countries. In this regard, the United States recognizes China as the main economic threat, which is explicitly stated in the National Security Strategy of 2022. The goal of China is to become a superpower, strengthen cooperation with countries, primarily in the Asia-Pacific region and achieve technological independence. The growing power and the course chosen by Chine do not correspond to the national interests of the United States, which in the future may lead to significant economic pressure on the region from the United States, including through the outbreak of a conflict with Taiwan and the subsequent imposition of sanctions.

• The US military presence around the world is carried out through intergovernmental military associations. The main US objectives are to control Russia and deter China in foreign economic and policy activities.

• The US foreign policy activity is aimed at "inducing countries to mutual cooperation" both through direct military or political intervention and "soft power", such interactions though often resulting in destabilization of the domestic political situation and the aggravation of international relations.

• Taking into account the global situation and aggressive methods of conducting foreign economic activity of the United States, countries are trying to reduce gradually the use of the American currency in international transactions. The Chinese yuan may replace the dollar.

  The European Union

The EU abides by NATO preferences while taking decision in military and security spheres. EU – NATO official cooperation roots back 2002. Since that time both achieved the proper level of coordination in solving problems, despite existing conflicts in interests. For example, NATO seeks to make decisions on ensuring sustainability, military and energy security, while the European Union seeks to position itself as a sole participant in the defense process, which encourages joint purchases of military capabilities.

But it was in 2016 that their interaction reached a new level. At the Warsaw NATO Summit their first joint declaration was adopted in response to the accession of Crimea in 2014. The main purpose of this document is to formally consolidate actions of both institutions for financial and defense support and ensuring the security in Europe.

The EU-NATO Joint Declaration on Cooperation in 2023 made amendments to previous versions of the document. Updated approach consists in granting maximum support to Ukraine, building defense complex to protect Europe and the Euro-Atlantic region at the expense of the most developed or cooperative member countries. The declaration additionally provides for strengthening the primacy of NATO in the coordination of this alliance, which equal to the EU's political dependence on the United States recognizing, America currently occupying the dominant role in the military alliance.

Another important vector of the EU's military course is to ensure the proper level of the region's defense capability by replenishing weapons stocks.

Despite the fact that founding treaties ban financing arms supplies from the EU budget, the Europe has found a way to circumvent the restriction and help Ukraine in further escalation of the conflict.

The solution is the European Peace Fund, initially created to improve the security and defense capabilities of European partners, now helps to send this money to Ukraine. Since SMO started, the EU has sent about 325 tanks, 36 attack helicopters and more than 200 multiple rocket launchers, about 1,000 drones and ammunition worth a total of € 3.6 billion. In addition to the general package of military assistance, individual EU countries have sent a huge amount of military equipment, including combat vehicles, artillery installations, missiles, etc., thereby leaving themselves without strategic reserves, as well as exposing the weaknesses of European industry in artillery shells production.

It is for this reason that Jens Stoltenberg, at a meeting of European Union defense ministers in Brussels, called for even closer cooperation between NATO and the EU in order to increase the production of ammunition and military equipment, both to support Ukraine and to replenish the union's own reserves.

With the beginning of the SMO the EU resumed an active policy of imposing sanctions and restrictions on citizens of the Russian Federation, large legal entities, government officials, technologies, products, etc. During all this time, Russia has faced so far 10 packages of sanctions against Russia, which were conceived to "destroy" its economy, while it had a negative impact
on the EU countries.

In particular, European production facilities were not ready for such a large number of defense orders, so they faced a shortage of raw materials: various types of metals and inert gases necessary for the rapid manufacture of ammunition and military equipment for supplies to Ukraine. After all, about half of the strategically important materials are exported to the EU from non-union countries. For example, Russia is the main trading partner of the EU in many types of raw materials: aluminum, natural graphite, being among top 15 exporters. Most of the Russian metal supplies are sent to Baltic countries, Germany accounts for about 8.8%, followed by Italy, Finland, Poland and Belgium. China has a monopoly (86%) on the extraction of rare earth elements, such as dysprosium, terbium and praseodymium, largely used in military aviation, for example, when manufacturing missiles, engines or electronic aircraft systems. Therefore, the countries and military-industrial corporations of the European Union are obliged now either to look for new ways of profitable imports and to find new solutions.

The European Union, contrary to all forecasts, managed to neutralize certain risks and made some progress. Thus, according to the European Commission, economic growth in 2022 exceeded 3%, unemployment is at a historic low of 6.5%, and industrial production fell much less than expected.

The Eurozone countries, affected by the energy prices rise, experience a slowdown in the economy growth rate, but the total annual growth in the last quarter of 2022 reached 2.1%. As for dependence on Russian energy carriers, the EU managed to normalize the situation caused by the imposition of sanctions against the Russian Federation in 2022. Europe, by pursuing a policy of substitution, searching for alternative suppliers and, above all, saving by reducing consumer demand, was able to achieve almost complete independence from Russian resources and agree on a price ceiling for joint gas purchases in 2023. Nevertheless, by reducing the import of natural gas from Russia by 80%, the United States doubled the supply of LNG to Europe – from 47.8 million cubic meters in 2021 to 117 million cubic meters in 2022. The EU also increased oil supplies from 400 million barrels in 2021 to 552.5 million barrels in 2022, thereby Europe changed one dependence to another.

Nevertheless, Europe risks facing new challenges in 2023. The COVID-19 pandemic and the energy crisis caused by the conflict between Russia and Ukraine have accelerated inflation in the world's largest economies. The global financial system is failing, and the EU central banks are forced to respond by raising the key rate. Inflation, despite the fact that it peaked in mid-2022, declined in the first quarter of 2023, thanks to the ECB's tight monetary policy. Nevertheless, core inflation remains at a high level. It began to grow due to the increase in prices for goods and services reaching maximum annual values: since the beginning of 2022, production in many industrial centers of Europe has risen in price, which led to an increase in prices for final products for the consumer. In March 2023, core inflation reached a historic high level of 7.6%.

And contrary to the favorable forecasts of financial experts, inflation in 2023 may not meet the expectations of Europeans and climb up, due to several factors, such as volatility of energy carriers prices, limited demand, the monetary policy of the leading European banks, increase in interest rates on loans, the continuation of sanctions against the Russian Federation. All these circumstances provoke discontent among population and exacerbates economic problems within the organization.

The EU's foreign policy course at this stage is chaotic and does not reflect a single concept that all members of the Union abide by. Several factors contribute to this: direct dependence on the opinion of the United States, as a result, the disagreement of some participating countries about the chosen course and the disparity of opinions on certain issues.

The European Union in her foreign policy often makes decisions guided by the interests of the United States, and not members of the Union. In particular, Washington presses on its "allies"
to approve a list of the next sanctions against Russia, which have a negative impact on the EU itself. After all, unlike America, the European Union is an association of several independent states with national interests and needs that may run quite opposite to the opinion of the United States.

Thus, more a more often we see certain EU decisions on the foreign policy cause discontent of local European population. For example, at the end of May 2023 in Brussels, the EU countries discussed the 11th package of sanctions against Russia, which provided for restrictions for those who help Moscow to circumvent the sanctions imposed. The EU did not manage to come to an agreement, as some members of the organization, particularly Hungary and Greece, opposed to the adoption of this package. Athens was dissatisfied with the fact that two Greek companies had been included in the sanctions list in connection with their alleged participation in the shipping of Russian oil. Hungary, in turn, stated that it would block any initiative on Ukraine while the Hungarian OTP Bank, included in the corresponding list due to the work of a financial institution in Russia, would be in the national register of "sponsors of war".

Due to the constant difficulties in making joint decisions on the situation in Ukraine, several EU countries decided to unite in a "Group of Friends". It included representatives of the "Old Europe": Germany, Italy, France, Belgium, Spain, Luxembourg, the Netherlands, Slovenia and Finland. This initiative is presumed to facilitate and accelerate the process of coordinating decisions in the field of foreign policy and defense by giving up their right of "veto". Recently, the EU's dependence on Americans reached an absolute maximum, turning the union into an organization completely dependent on the United States. That is why an increasing number of European leaders advocate strategic independence from the United States and the development of a sovereign course, different from the one imposed by Washington, in all areas, including the economy, politics, energy and industrial sectors.

• In 2023, EU and NATO adopted an updated Joint Declaration on Cooperation granting maximum support to Ukraine, building defense complex to protect Europe and the Euro-Atlantic region.

• In view of the EU sanction policy, European production facilities faced with the raw material shortage, which made military-industrial corporations of the European Union look for new ways of profitable imports and find new solutions.

• Europe risks facing new challenges in 2023, including inflation augmentation and a banking crisis.

• More and more European leaders become committed to the EU independence from the USA and support building its own course different from that imposed by America.

To conclude, the milestone of the global development 2022-2023 is the emergence of new political and economic centers and displacement of the old ones. The transition of the global powers to polycentric world increased the importance of international alliance guided by Russia and China. Such factors as the growth of the state debt, methods of conducting foreign policy challenge the current status of the USA as a world leader. A number of countries all over the world start become obliged to reconsider their relations with Washington. Their desire is to guarantee state sovereignty and facilitate own economy independent from the USA.

The UAE, Saudi Arabia, Turkey and some other countries have already chosen their own development path. The loss of a proper support inside the country as well as from the foreign partners can lead to a decrease in the effectiveness of the international and financial levers of pressure previously used. This also might implicate the volume of assistance provided to Ukraine to the extent arms supply stayed.

Asia-Pacific region remains a priority for the USA. While China starts to play a leading role in the region, the US loses its positions. In response, America tries to tighten links with other military alliances, such as QUAD and AUKUS, making everything possible to weaken China's military and economic potential. In these conditions, relations between China and Taiwan, supported by the United States, are straining.

Given the global tensions, Russia and China have become main military and economic partners. The sanctions war initiated by the EU against Russia accelerated the reorientation of the Russian economy from the West to the East, while having failed to give fruits desired by the West. The examples of Russia and Iran fully demonstrated that the Western unilateral sanctions must not be considered anymore as efficient tool of pressure on the states. Strong international economic ties among the countries help the economies to overcome the imposed restrictions and continue further development, promptly changing the course and strategic partners.

Geo-economics becomes an inherent part of geopolitics. It turned out that polycentric world, which seems to be now the be the only true way to maintain the world order, could exist subject to a comprehensive analysis of factors affecting international security and stability. Information becomes an important resource when making critical decisions at the state level.