New World Order

This here is filled with events of the past, present, and potential future. For the purpose of this piece, I’ve had to make extensive research. Because generally speaking, the order of the world today doesn’t make it so obvious how some unknown and known forces determine how we live our lives.

Much like me, did you have an obsession with the Illuminati, mysterious hand signs in music videos, and 666 at a very young age? When you could have had a normal childhood like everyone else? Well. If you fall into that category, worry not, this write-up is neither a conspiracy nor is it a theory. It is as real-life as it gets. So, you wouldn’t have to revert to your dollar store detective Sherlock Holmes online persona. I’ve taken on the burden to do that instead.

There is currently a new world order that is gravitating towards its goals today. Because of the war in Ukraine, and other factors, it is becoming more and more accelerated. I should hope that we can explore all the grey areas together in this piece. So, buckle up. We are about to get deep into the weeds.

A New Super-Power

The world as we know it today is ever-evolving. People may fail to change with time, but time changes regardless. You can easily be left behind if you never get used to the idea of an ever-changing world.

Before the beginning of the First World War (1914), there existed a form of a multi-polar world (multiple powerful countries), where countries were concerned with never having a single country/empire that was hegemonic in nature. In Europe, Britain played the role of maintaining a balance of power. Balance of power in essence is a situation where Country B allies with Country C because Country A has become too powerful, and therefore poses a threat to the national security of Countries B and C.

This is mostly why countries form alliances. In most cases, it acts as a check on any country that is becoming or has become too powerful.

The most powerful alliance before WW1 were the Triple Entente, which consisted of Britain, France, and the Russian Empire. The rival alliance was the Triple Alliance which was comprised of the German Empire, Austria-Hungary, and Italy.

The United States was still a state that enjoyed its isolation since it only recently gained independence from Britain in 1776, so it never got involved in the European war until 1917. A major reason it got involved was the telegram that Germany had intended to send to Mexico, but the telegram was intercepted by the British intelligence Agency. The telegram exposed Germany’s plans to have Mexico declare war on the US which is a neighbouring country.

After this, the US declared war on Germany and then joined on the side of the Triple Entente. This single event introduced a to-be superpower. Following this event, the US left its isolation position and began getting engaged in world politics. It also began ramping up its military might, especially its naval superiority in the Pacific. Two years later in 1919, the First World War ended.

Again, the U.S., although supplied resources and ammunition to the allies during WW1, when the Second World War started in 1939, it never wanted to be dragged yet again into another European war.

But its direct involvement was inevitable following the attack on Pearl Harbour in 1941. Japan launched an unprovoked attack on the to-be world power. Japan was an ally of Germany during WW2, therefore, Germany declared war on the US. This was how the US joined the war.

By the end of WW2, Europe was in flames, China was going through a civil war, Japan had just been nuked, Africa and most parts of the world were breaking their colonial statuses and gaining independence. Only the US and USSR (Russia) remained the strongest countries in the world.

The US became the strongest in the Western world, so it made quick use of its newly gained super-power status by strengthening its grip on Europe, and by large, the rest of the world.

Immediately after WW2 ended in 1944, the US introduced a new order. First, it set up the Bretton Woods system of monetary management which established the rules for commercial and financial relations between the US et allies. The system changed the world order from a predominant use of gold for international relations to the use of the US Dollar currency. This was the beginning of a new world order and the rise of the United States of America as a hegemonic superpower.

A Whole New World

Shortly after the US Dollar replaced gold as the global medium of exchange, the US established the World Bank and the IMF (International Monetary Fund) which further solidified the grip of the Dollar currency in global trades.

In 1948, four years after WW2, the US enacted the Marshall Plan which was intended to provide economic assistance that will restore the economic infrastructure of post-war Europe. In a lot of sense, the US became the sugar daddy of Europe since WW1.

Following the economic recovery idea of the Marshall Plan, most of Europe and other US-dominated parts of the world had to make exchanges with the dollar. The US also bought oil from Saudi Arabia and other OPEC members (Oil and Petrol Exporting Countries) using the dollar. These, among other international actions by the US, helped solidify the grip of the US on global markets.

When the Dutch (17th century) was the leading global power, the Dutch Guilder currency was the world reserve, and when Great Britain (19th century) was leading in the world, the reserve currency was the British Pound. The US became the leading world power since the end of the Second World War (20th century), thus establishing its currency, the US Dollar, as the global reserve currency. This is simply how new world orders take effect. A good study of history will help you arrive at a similar conclusion.

Not to be left behind, the USSR (Union of Soviet Socialist Republic) also introduced similar plans to the Marshall Plan. One was military, while the other was economical. These were called Cominform and Comecon. But all these did was increase tension on the European continent. So, in response to a perceived sense of aggression (the USSR, today’s Russia, was a totalitarian empire), the US along with 11 other European states created the military alliance called NATO (North Atlantic Treaty Organization). To balance this, the USSR, under Nikita Khrushchev created the Warsaw Pact in 1955. But prior to this event in 1954, the KGB (called FSB today) secret police was established. Previously also in 1947, the US created the CIA which will later go on to help the US topple governments across the world.

All of these calculated and uncalculated events sparked an ideological war of capitalism vs communism between the world’s two great Superpowers. Each of them tried to expand their influence to other parts of the world, while they were simultaneously trying to suppress the rise of the other. They engaged in lots of Proxy (indirect) wars. This was called the Cold War. It lasted between 1945 and 1991.

In 1991, the USSR (Soviet Union) collapsed, and it gave birth to 15 new countries (including Ukraine and Russia). The fall of this rival power led to the United States becoming a single global superpower.

A Global Village

Since the fall of the Soviet Union, the US became the single strongest country in the world, militarily and economically. Naturally, it leveraged this and became a superpower. Established military presence in the world and tangling most of the world's economies with its own, so much that they may be trading with the US at a loss. This is especially for the fact that most third-world countries rely on the US and Europe for consumer goods. All of these were exacerbated by the globalization that started all the way since 1944's Bretton Wood's financial system.

The world is now a global village. Previously, if you wanted products from other places, you’d have to invade or colonize them. But now, it is easier to move people and products to any part of the world. The world is connected today more than ever. While the international system is artificial, some countries are more critical to the global stage than other countries. For example, there are about 195 countries in the world today. Yet, China made up about 16% of all global exports in 2021, while the US accounted for about 9%.

If these two countries sneeze, the world will catch a cold. That’s how much the world is globalized today. Personally speaking, even you know how much of your material possessions were made in China. But on the bright side, the UN reported that more than 1 billion people have been lifted out of extreme poverty since 1990. The quality of life of people has been increasing. Your ceramic toilet is made in China, your phone is from a Korean company, your car is from Germany, your internet provider is from South Africa, your fast-food restaurants are from America (of course they are), your TV was made in Japan, and so on, and so forth. The world, essentially, is a GLOBAL VILLAGE. This is globalization.

Speaking of China, it ended its civil war in 1949, and even as it was trying to reform its economy after the colossal failure of Mao Zedong's communist movement (1976), the US lent it lots of money in a bid that China will tilt away from communism and become entangled with the global capitalist market. Note here that the Cold War didn’t end until 1991. So, China also owed the US a lot of debt, and would only pay back with dollar exchange, which makes its currency inferior to the dollar.

In no time, most of Asia began trading and making exchanges using the dollar currency. Most of the world was already somehow connected to the US market. Naturally, it became an entirely new ballgame during the technological revolution in the US. They had fridges, microwaves, phones, computers, they invented the internet in 1983, etc. They exported all these products to other parts of the world and most of these countries exchange their currency for dollars in order to purchase the commodities.

The IMF and the World Bank helped tie most of the world to the US economy. Countries began setting up their foreign reserves in the US. They bought US security bonds, etc. From all these micro and macro events, the US Dollar became the global legal tender. While this is advantageous for most countries, most other countries have other stories to tell - it doesn't favour them so well. This is the case for most third-world countries. Because of the unfair exchange rate and the low-interest rate for those who have their monies in the US treasury, the relationship comes off as one-sided, and that which is based on exploitation, as opposed to a mutual win-win relationship.

In International Political Economy as a field of study, Underdevelopment Theories are adopted as a way of understanding how the relationship between the Global North (first-world, second-world countries) and the Global South (third-world, fourth-world countries) is skewed to favour the Global North. This is usually explained in the trade of raw materials in exchange for overpriced finished goods.

Countries would also take huge loans from the IMF or the World Bank, and since the loan comes in the dollar currency when tallied against said country's currency, the dollar takes superiority. And because of this disadvantage, said the country might be subject to the dictates of the United States. Although the US isn't the only antagonist in this case. China is also an accomplice in cutting unfair deals with some parts of the world, especially Africa. This in essence is called debt-trap diplomacy.

A Global Relationship

Debt Trap Diplomacy is an international financial relationship where a creditor country or institution extends debt to a borrowing nation partially, or solely, to increase the lender's political leverage. Although most people would disagree on the fact that China is in fact helping these countries, as opposed to gaining influence or any other alternative goals. Then I would say that most people don't understand how international relations work.

Being a realist, I know for certain that the reason most countries engage with other countries (i.e, draft a foreign policy) is to foster their own National Interests. In cases where country A owes about 50% of its national debt to country B, country B will gain political influence over country A. The said political influence can be a tool to shape domestic or international political affairs. Thus, Country A's sovereignty will be undermined. But hey, this is just how international politics work. If Nigeria or any other country was trying to rival the US, China or Russia for global influence, chances are they will also engage with other countries to solidify their position on global affairs.

Where some countries have defaulted on their loans, China has seized some of their assets. China has taken a seaport in Sri Lanka, an airport in Zambia, another airport in Uganda, Kenya almost lost its Mombasa airport to China in 2019, etc. Nigeria owes China about $4.5b, Angola owes $25b, and Ethiopia owes about $13b. With this amount of debt, any lending country could forfeit the debt if the borrowing country swears loyalty. This is International Politics 101.

Powerful countries in the world (like China, Russia, and the US) are actively in some kind of struggle to see which one has the most influence on the global international system like the United Nations. In the U.N., countries are all recognized as equals. Although, not in practice. Nigeria, for example, is stronger and richer than most other African countries. But along with these African countries, they all have equal votes on global matters. Although there are 5 permanent members of the U.N's Security Council who can veto any decision of the organization. These 5 countries include the US, France, the UK, Russia, and China.

So, naturally, these countries would love to remain at the top, and would actively and passively compete amongst themselves in extending their influence over to other countries. Because each member country of the UN has one vote, if you are allied with or have influence over most countries, you can sway multilateral UN decisions to favour you.

Anyway, that’s that.

Beyond the United Nations, there are also several alliances that are trying to act as some sort of check on other alliances. Some of these alliances are trying to replace the old order that the United States set up. This need to reform how the global system works ranging from the US’s interference in global politics, its weaponization of the US dollar against countries who have the dollar as their reserve currency, its many sanctions that have catastrophic effects, its desire to stop any country from rivalling its global supremacy, among other things.

A New Challenger

The lifespan of leading powers is between 100 to 150 years before they become challenged by another rising power (the US has been dominating for about 85 years). The rising power today is China (although Russia is also a perceived threat to Europe and the hegemony of the US). China's global GDP is 18% (it has also been rapidly militarizing). While that of the US is 13%. Clearly, the Chinese Yuan will challenge the supremacy of the US Dollar. Even if this takeover were to happen without the outbreak of a major war, in retrospect, other countries will also rise to challenge the supremacy of the Yuan. India and Russia will likely compete with China for the global reserve currency status.

Before today, many countries have expressed their discontent towards the arbitrary use of power by the US, especially the way it bullies other countries with the use or threat of force.

The world’s most powerful alliance was the G8. A group of highly powerful industrial nations. It included countries like France, Germany, Italy, the United Kingdom, Japan, the United States, Canada, and Russia. Over time, Russia – US relations got sour, and thus following the invasion of Crimea (a Ukraine territory) in 2014, Russia was expelled from the alliance. It was also bombarded with lots of Western sanctions.

When Russia left G8, the alliance became known as the G7. Russia quickly improved its relations with other members of another alliance it belongs to – BRICS. BRICS stands for Brazil, Russia, India, China, and South Africa. This alliance rivals the G7 on many different levels. For example, the current BRICS now contributes 31.5% of global GDP, while the G7 share has fallen to 30%. The BRICS is expected to contribute over 50% of global GDP by 2030. These 5 countries also make up about 41% of the world’s population.

So, it is likely that they will pose a threat to the global dominance of the US. It is also likely that things will rapidly change for both China and Russia – they are both autocratic states (not democratic, and also having leaders that are “above” the country’s constitution). Although it doesn’t seem likely that their autocratic status is any real threat of internal strife. For example, the US is tearing itself apart from the inside with how polarized it is today. The Left (liberals) and Right (conservatives) are actively at each other’s throats, and almost never willing to hear each other out. I can only hypothesize that the situation can only get worse over time.

Right now, more countries like Nigeria and Argentina are planning to join the BRICS alliance. This mighty alliance is rising to challenge the G7. If at all you’d love to comment at the end of this post, I’d love to have your opinion on why this is happening.

BRICS’ presence on the world stage is becoming ever so obvious. It is pretty clear that this is because of the changing world order. China and the US both have their own military-industrial complex. But in order to limit the ability of the US, China is planning on eroding the old order by introducing its own currency, the Yuan, as the legal global tender. This is going to be a New World Order.

A New World Order

The worldwide use of the US dollar as the global means of exchange obviously favours the US. But there are going to be demands for some kind of change when countries have the fear of facing the consequences of making independent decisions within their states, which the US might not like so much.

Do you remember the Chinese civil war I mentioned? Well, it hasn’t truly ended. During the civil war, the communists won, and the nationalists fled to Taiwan (an island off the coast of China), which was later proclaimed as an independent sovereign state. Mainland China refuses, till today (since 1949), to recognize the state as a sovereign country.

China has been waiting to invade and reclaim Taiwan, but Taiwan is an ally of the US. It thus has the military backing of the US. So, China is aware of the consequences of provoking the US and not face economic sanctions. This is especially given the fact that China has observed the West’s reaction to the invasion of Ukraine by Russia.

Following Ukraine’s invasion, Russia was removed from the SWIFT (international bank for heavy transactions) banking system, it also faced series of sanctions that affected its economy (although not so much, since it has natural gas and oil that almost everyone needs), etc. Add to this, the US weaponized its currency by seizing Russia’s dollar reserve. This had other countries (like China) wondering what’s going to happen to all their reserve dollars when they do something that the US dislikes. It is also important to note that China plans to invade Taiwan by 2027 (or earlier), and this will clearly spark a war between China and the US. Their allies will be dragged in, and this might lead to an inevitable World War Three because it won’t be a proxy war like that of the war in Ukraine. It will be a direct confrontation.

Beyond this, the US has also sent about $113b to support the Ukrainian efforts against the US. Also, sometime last month, the US Congress passed a $1.7t bill that could secure the US lots of influence around the world. After all, what desperate country will turn down the good ol American dollar?

The US also printed tons of money during the Covid period. These, among other reasons, are why most countries might dump the dollar for another currency. Because the sad truth is that if a particular government keeps printing money, it loses value, and the rate of inflation goes up. This isn’t particularly good for most countries that have to tally their own currency against the dollar in order to make international trades.

Here is where the BRICS comes in.

As of 2023, they’ve announced that they are planning on using a single currency for their trades, thereby dumping the dollar. Around the world today, lots of countries have started using their local currency for trade. China recently bought LNG (Liquified Natural Gas) from the UAE using its own currency for the first time.

The Chinese prime minister, Xi Jin Ping, also recently visited Russia to strengthen their ties. Countries around the world aren’t relying on the dollar to make or complete their trades anymore. China has even proposed a digital currency to replace the dollar. It might be difficult to replace the dollar. Mostly because as a means of running an economy, it is stable, and also very accessible.

Regardless, it may not be too obvious now, but the world order is changing. A new one is being set in place. Do you think the US will fight back? Do you think the US dollar will be replaced by Chinese yuan? Welcome to the new world.

Let me know your thoughts in the comment section.

A Closing Remark

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