Fault lines in the global economy
The economic and political aftershocks from Russia’s invasion continued this week, from Europe to Asia. Deep structural change is underway.
Coming from New Zealand, I am unfortunately used to earthquakes. After the main quake, aftershocks (some very large) are common. And after the tectonic shock of the Russian invasion of Ukraine, there has been a rolling series of aftershocks as the global economic and political system reconfigures.
Big power wars (as with pandemics) put pressure on fault lines in countries and in the global system. My assessment is that the Russian invasion of Ukraine, and the Western-led response, represents a rupture in the global economic and political system. These tectonic changes will play out over long periods, but the speed and scale of the aftershocks are already striking.
The global economy is fragmenting along political lines. Events over the past week or so provide more indications of the characteristics of this emerging environment.
The West renewed?
The scale of the Western-led response (economic, military, political) to the Russian invasion of Ukraine has surprised relative to initial…