Valdai Club

Very few analyses of the economy as an instrument of war have been published in recent decades, which is why expert discussions on this issue are so important. The Valdai experts had a dual task during the recent conference: first, to analyze the influence of the economy on conflicts, and second, to find a balance between constructive competition and destructive rivalry.

Discussions began with the automobile industry, which reflects countries’ economic behavior and potential. One of the experts said that the automobile industry is the third largest industry in the world. The example of the Russian automobile concern AvtoVAZ shows that companies need to fight their own weaknesses rather than rivals to make competition truly constructive.

Global economic relations were another major issue. One of the participants recalled that the capitalist classes had seized power from the aristocracy by advancing the ideas of trade, rationalism, the markets and peace, whereas aristocracy upheld the ideas of conquest, violence and wars. However, capitalism eventually provoked more wars and violence than any other social system. Free trade and globalization are cosmopolitan ideologies aimed at strengthening US domination. The BRICS countries are creating a multipolar world and spreading their industrial capabilities into new centers.

The trouble is that attempts to replace the old world order with a new one are coming across fierce resistance and often result in war. So the conclusion is that we need to find a peaceful method for creating a new world order. One of the Valdai experts said that multipolarity has a large peace potential because it makes conflicts more expensive for all of the potential sides.

The session participants also discussed economic interdependence and the balance of forces. One expert said that the current situation reminds him of the 20th century, when it was believed that interdependence would prevent conflicts and that economic growth would help settle all problems. The current conflicts in Ukraine and the Middle East are similar to the 20th-century conflicts in Korea, Vietnam and Africa. Confrontation has acquired a global nature for the first time since the dissolution of the Soviet Union. The expert said that any war changes the political and economic balance in the world. The United States gained from the first and second world wars. Russia lost a great deal as a result of WWI but became a superpower after WWII. The expert said he doesn’t think the world is facing a third world war and that the situation rather reminds him of the Cuban missile crisis.

Speaking about sanctions, one of the session participants said they had been introduced against Russia because its economy was not diversified, its civil industries were obsolete and its share in global trade and GDP was very small. Economic diversification is now considered in Russia as an element of national security. The expert also pointed out that Russia is developing new international groups based on the SCO and BRICS, and that the SCO countries already account for over 20 percent of global GDP and may surge ahead of the EU economically in 2020.

We are witnessing the reconfiguration of global economic and geopolitical interests. The Eurasian Economic Union (EAEU) corresponds to the best WTO practices and is forging an alliance with the Silk Road Economic Belt. Cooperation in this association will not only take the form of infrastructure projects but also of simplified trade procedures, the development of high technology and mutual protection of investments. The Valdai experts also mentioned the completion of the talks on the Trans-Pacific Partnership (TPP), an association of 12 countries, which accounts for 36 percent of global GDP and will coordinate trade, the employment market and intellectual property issues. As one of the experts said, it appears that the United States has opted for creating new organizations instead of reforming old ones, such as the WTO. 

In conclusion, the session participants said the countries should unite to create a new balance of civilizational forces, deal with climate change, fight poverty and address environmental issues and natural disasters. All of this boils down to breaking the vicious circle of wars.