We are drifting through a time when the world’s economic center of gravity is shifting towards the East. On one hand, the EU is seemingly trapped in a cul-de-sac after Brexit and the withdrawal of the TTIP, while the US is looking for a new economic playbook after attempting to shake off the effects of the 2008 financial crisis and the Trump election. On the other hand, the Middle East has yet to be stabilized. The ambiguity caused by the US Federal Reserve Bank still exists. The economic trajectory of the EU is blurred and uncertain. And the events surrounding Brexit have been challenging—to say the least. Some of the comments coming from the EU states of a racial nature are negative -- affecting world peace. The failed approach taken by G20 governments to establish their respected countries’ economic security is slowly evolving into greater protectionism, which may even lead to economic discrimination and a detriment to economic growth.
In this tumultuous period the G20 faces new facts where economic security needs to be implemented by all national governments. Ultimately economic security has to become the utmost concern of their sui generis agendas due to the clear relationship between the prosperity of a nation and its electorate’s voting patterns. They should have this as a high priority when they meet in Hamburg later this week.
As we move through the demands circling economic security policies, it is evident that they need to be designed with attention to the both ideologies and theories of the past. Increasing arms trade, pushing an economic crisis within the borders of another country, or trying to take valuable natural resources, are examples of some past anachronistic approaches. These approaches used to work over a long period of time, however, it is now clear that they are not sufficient, justifiable, nor sustainable. The G20 needs a new definition and rationale for economic security in our tumultuous world.
Multilateral trade treaties were designed to offset the competition from China initiating the “One Belt One Road Project,” however they have not materialized. While the US created a new economic path for itself, focusing on shale gas and energy, the EU has become even more desperate for the energy resources from the East.
With the initiation of the Silk Road, Turkey has become one of the most strategic countries once again, increasing its geopolitical significance, and transitioning into an immutable trade hub. Since the route to both extract and transport the natural gas that was recently discovered in the parts of the Eastern Mediterranean Sea will pass directly through Turkey, it is safe to assume that the world’s geopolitical key will shift in Turkey’s direction. This is an opportunity for the world and for Turkey, both. It is clear that the Külliye (Turkish Presidency) is itself most willing to be collaborative. The increasing Turkish population in Europe and the natural hinterland Turkey has in both Asia and the Middle East are examples why Turkey is evolving into an ally that the West needs more than ever. It should therefore establish robust relationships with Turkey based on a sound economic relationship and not just a narrow geostrategic one.
But terrorist organizations are truly hurting global economic dynamics. The profits made from arms trade for “counterterrorism” are far below the economic losses caused by terrorism itself. It is almost impossible to say that the coalition to “wipe ISIS from the face of the world” has been altogether successful. The rightful argument coming from the country with the second biggest army in NATO –the Republic of Turkey— as regards this global problem, is to not fight terrorism by sponsoring or creating other forms of terrorist groupings, such as the YPG. Rather, it is both intuitive and proven that the prevalence of terrorism in the region hinders further trade and economic growth, which is worrisome for global economic security. By adding the North Korean threat and the unpredictable approach by Iran into the equation, we see a complex scenario where countries are getting ready to engage in a new round of warfare to protect their economies. The peace that we all yearn for seems unattainable when countries are of the conviction that warfare is the only solution for economic security. This is the main reason why the United Nations economic security should not end in warfare. But the Security Council too often ends up being dysfunctional in solving these interconnected problems.
The misconceived notion of capturing the world’s natural resources to ensure economic security is based on a faulty first premise. These failed policies fuelled by this specific notion profoundly increase global inequality. As before WWI and II, it is certain that inequalities lead to public uprisings such as the Arab Spring and then adversely impact global peace and stability. Who exactly benefits from the situation where the streets of the resource-rich countries turn into inhumane environments with disastrous conditions? No global power or group can sustain these inequalities when the speed of communications is improving in an ever-faster pace; and content is being shared on social media within seconds worldwide.
The famous “End of the History” thesis by Francis Fukuyama is certainly being challenged and refuted by reality today. The G20 should come to the realization that our new era hints at a valuable lesson for the world’s nations, namely, to replace war with peace by greater multilateral collaboration so as to ensure economic security for all peoples, east and west.
M. Levent YILMAZ, Ph.D., is the chief economist to the President of Turkey