Economics is at the forefront, intertwined with politics, shaping international relations today. Global politics is entering a new era driven by artificial intelligence (AI), offering vast opportunities to advance economic growth.
Economic security is evolving in response to new political realities. International relations are reaching unprecedented depths, where fractures begin to emerge, unfolding an entirely new world order. This new order – or disorder – is bound to take shape following major global political shifts, particularly after US President Trump set new trends in international relations.
The world must build trust at a global level to foster growth and investment. The new intelligent age can make this possible – provided world leaders recognise its potential and turn it into a reality. US President Trump has the opportunity to assume a leadership role in guiding the world toward a brighter future for all.
However, leaders from the European Union (EU), African Union (AU), Association of Southeast Asian Nations (ASEAN), South Asia, the Middle East and Latin America must also step forward to forge unity among the community of nations. Figures like President Putin and President Xi Jinping must play a greater role in fostering collaboration and cooperation to bring peace and prosperity to the world.
The ‘protectionism’ currently emphasised by the US and the EU – after years of promoting liberal economic policies – may not be conducive to sustained growth and investment. The AI-driven age may not align with restricting industry and technology.
The scope of AI-driven technology is broad-based and can be leveraged for large-scale economic growth. Technology and its applications are universal and cannot be denied to the world for the benefit of a select few. Efforts to restrict access to technology may hinder growth and investment, posing threats to freedom, equity, and prosperity. World leaders must prioritise technology-driven economic growth through collaboration and cooperation rather than imposing limitations.
The World Economic Forum in Davos, Switzerland, signalled a major shift by advocating to ‘collaborate for the Intelligent Age’, sending a clear message that future security concerns should not be dictated by political turmoil. Geopolitical realities may no longer disrupt geo-economics, as economic priorities now dominate international relations. The technological revolution has replaced outdated notions of chivalry and military strength. Economic security has become synonymous with state security, with AI playing an increasingly significant role in shaping future state relations. Future economic power will depend on capital investment in technological development, which, in turn, will define international relations.
But what about the humanitarian crises and political developments in the Middle East, Africa, Asia and Europe? Syria and Ukraine will be defining future world relations in and among the international powers. China’s role will be very important in shaping the future course of action.
The most important question is to see whether China or the Western world will lead the new world order. The US and its Western allies, including Nato countries, are all out against China to lead in the field of economy and security. Who will set the new world order in place to capture world businesses and markets? The years ahead will witness a new race in the field of technology led by AI companies to dominate the world. Those who will cooperate and facilitate the world by providing free AI products or services at affordable rates coupled with a smooth supply chain mechanism will capture the markets.
A new world order is in the offing. The developed countries are in a state of war reminding us of colonial wars in the 17th and 18th centuries with a new set of principles. Nevertheless, multinational companies and tech giants are new colonial powers shaping up this world. The new tools of war are chips and semiconductors, information technology (IT), artificial intelligence (AI), tariffs and taxes and new supply chains. A new race is currently at its peak to colonise developing countries through these tools by the developed world. Intra-group rivalries are part of the game.
Noam Chomsky once said, "Invasion is a culture, not an event”. The era of neocolonialism is culminating in the form of new technological invasions, potentially exploiting the so-called Third World countries that lack the resources and vision to lead. The developed world is locked in fierce competition, seeking to overpower one another through new tools of war, aiming to dominate developing countries for years to come. This is the underlying reason behind the ongoing chip wars and EV trade restrictions between the US/EU and China. The trade and technological wars may take a long time to conclude. Who will gain the upper hand? That is the question. But the larger question is: where will it all end?
A new class of technology elites is emerging to monopolise global trade and business. Chips and semiconductors are the lynchpin of these newly developed technologies. Batteries have become pivotal in powering the machines that are transforming the world. AI applications powered by advanced chips have ascended to a position of dominance in the technological landscape. Wealthy, advanced nations – particularly the US, Russia, China and the EU – are racing to outpace their competitors by monopolising chip and semiconductor technologies. There is no doubt that tech elites will rule the world in the future.
The era when armies ruled the world is over. The security paradigm has shifted from traditional military strength to economic prowess. All strategic arms programmes – from missile technology to nuclear weapons – are directly or indirectly connected to modern software technologies. The world and global business landscape are undergoing rapid transformation due to technological advancements. President Trump has announced an investment of approximately $500 billion to develop AI programmes. The CHIPS Acts passed by the US and the EU allocate significant funds to this technology to safeguard their interests and maintain their global superiority.
In addition to other strategies, the US is imposing new tariffs and taxes on products from Mexico, Canada, and particularly low-cost Chinese EVs to protect its own industries. It is interesting to note that nations that once championed free trade under the WTO are now erecting new tariff barriers against affordable Chinese EVs and other products. They justify these measures by accusing the Chinese government of subsidising its industries, thereby distorting market competition. The politics of economic corridors is in full swing. The new reality is that the global leader will be the one who dominates the AI-backed global supply chain through economic corridors.
Among the most significant developments are President Trump’s executive orders to withdraw from the World Health Organization and the Paris Agreement – both serious setbacks for global health and climate action, shaking the very foundation of the UN. International relations are increasingly at the mercy of decisions made by the world’s major powers and leaders. Let’s see how economics, politics, and international relations unfold in the future of global affairs.
The writer is a former additional secretary and can be reached at: hassanbaig2009@gmail.com
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