The world has talked about emerging markets for years. Locomotives of global growth, hot beds of productivity and burgeoning human capital: that’s all spot on, but dare I say it, horribly passé. We need ‘new thinking’ on emerging markets, and the news flash is pretty simple: geo-economic power has shifted so far East that we shouldn’t be referring to China as an emerging market, but an geo-economic powerhouse. More importantly, such gains are translating into geopolitical muscle that emerging powers are flexing across the board. They will be flexed even further when capital accounts are made to pay. The US is only solvent so long as Beijing now says it is: Europe isn’t doing much better. We can pass the debt parcel around all we like, but in the longer term it’s clear where capital will come from (p.s. the Bundesbank is the wrong answer). Europe is in decline, America is hanging on for all it’s worth; the ‘rest’ will continue to rise. China will be at the helm. 

Such shifts are already playing out at the highest level of international relations: the G2 of US and China. What makes the G2 particularly interesting is not just that it constitutes the pinnacle of global affairs, but that other emerging markets are starting to wield more regional political clout thanks to relative US decline and a rising Middle Kingdom. Smarter states are even starting to position themselves between the US and China to optimize political gains - a dynamic that will likely persist given the need for ‘third party’ counseling in any dysfunctional relationship. G2 matrimony is real, but it’s not working out well, and that’s despite having the veiled polygamy of the G20 to ‘work through’.

Africa, Central Asia, the Middle East, and even Latin America are playing this ‘Chimerica’ game. They know US power is on the wane; they also know that their economic ‘demand security’ (hydrocarbon or otherwise), will increasingly emanate from Asian shores. Gulf States are more acutely aware of this than anyone; political arbitrage with Sino-US energy interests is the order of the day for those structurally dependent on hydrocarbons. Meanwhile the likes of Turkey and Iran are forging increasingly independent political roles from US, European or Chinese interests. India and Brazil also have their own foreign policy preferences and goals. They sided with China on global climate talks, but continue to hedge their bets on currency questions. Even on critical security issues such as Iranian sanctions, the US has been unable to fully count on the EU, let alone Ankara or Brasilia at the UN. Russia is claiming regional leadership once more, a boast that few European’s can refute in the Caucasus or Eastern Europe, while Venezuela, South Africa and Nigeria have been carving out distinctive regional niches. It might not all sound like much yet, but it’s a clear indication of what we can expect in a fractured geopolitical configuration: divergence and entropy. 

The fact that emerging markets don’t see eye to eye on a range of geopolitical issues is not just significant for governance gaps at ‘the top’, but actually points to the blunt fact that this is now global governance in action: namely emerging powers following their own agenda and their own interests. Whether you call that a political vacuum or merely a fleeting reflection of power shifts underway is debatable – but the trend is clear: neither the US, nor Washington flanked by Europe and Japan will be able to underwrite regional balances indefinitely. Geoeconomic muscle in the East and chronic geopolitical fatigue in the West will be the defining trend of the coming decade. So much so, China can already decide when it calls time on US debt: when it does, America’s role as a sole superpower will rapidly follow. The security slack will need to be taken up elsewhere. 

Obviously bracing all emerging markets in the same political bracket doesn’t really work at this stage. Stark differentiation is still needed, not only between China and the BRICs, but the BRICs and other emerging players all riding the Chinese dragon. It’s also by no means ‘guaranteed’ that emerging markets will be able to overcome deep seated capacity constraints any time soon. MENA turmoil has been a very loud wake-up call for anyone assuming that emerging markets are already politically home and dry. But what it also starkly illustrates is the notion the West, and most notably the US, can singularly keep pulling all the geoeconomic and geopolitical strings is a no brainer. The world has changed, and it’s changed for good. 

Matthew Hulbert, Head of Energy & Political Risk, Center for Security Studies, ETH Zurich$0