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  • 1. NIC 2004-13 Report of the National Intelligence Council’s 2020 Project Based on consultations with nongovernmental experts around the world December 2004To obtain a copy of this publication, please contact:Government Printing Office (GPO), Superintendent of Documents, PO Box 391954,Pittsburgh, PA 15250-7954; Phone: (202) 512-1800; Fax: (202) 512-2250;;GPO Stock 041-015-0024-6; ISBN 0-16-073-218-2.
  • 2. Contents Page Executive Summary 9 Methodology 19 Introduction 25 The Contradictions of Globalization 27 An Expanding and Integrating Global Economy 29 The Technology Revolution 34 Lingering Social Inequalities 37 Fictional Scenario: Davos World 40 Rising Powers: The Changing Geopolitical Landscape 47 Rising Asia 48 Other Rising States? 51 The “Aging” Powers 56 Growing Demands for Energy 59 US Unipolarity—How Long Can It Last? 63 Fictional Scenario: Pax Americana 64 New Challenges to Governance 73 Halting Progress on Democratization 73 Identity Politics 79 Fictional Scenario: A New Caliphate 83 Pervasive Insecurity 93 Transmuting International Terrorism 93 Intensifying Internal Conflicts 97 Rising Powers: Tinder for Conflict? 98 The WMD Factor 100 Fictional Scenario: Cycle of Fear 104 Policy Implications 111
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  • 4. Graphics and TablesChina’s and India’s Per Capita GDPs Rising Against US 31When China’s and India’s GDPs Would Exceed Today’s Rich Countries 32Telescoping the Population of the World to 2020 48China’s Rise 50Projected Rise in Defense Spending, 2003–2025 51Fossil Fuels Will Continue to Dominate in 2020 59An Expanding European Union 60Number of Religious Adherents, 1900–2025 80Key Areas of Radical Islamic Activities Since 1992 82EU: Estimated and Projected Muslim Population, 1985–2025 83Global Trends in Internal Conflict, 1990-2003 101 5
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  • 6. Special TopicsThe 2020 Global Landscape 8Mapping the Global Future 26What Would an Asian Face on Globalization Look Like? 28What Could Derail Globalization? 30Biotechnology: Panacea and Weapon 36The Status of Women in 2020 38Risks to Chinese Economic Growth 52India vs. China: Long-Term Prospects 53Asia: The Cockpit for Global Change? 55Global Aging and Migration 58Could Europe Become A Superpower? 61The Geopolitics of Gas 62Eurasian Countries: Going Their Separate Ways? 74Climate Change and Its Implications Through 2020 76Latin America in 2020: Will Globalization Cause the Region to Split? 78Organized Crime 96Cyber Warfare? 97How Can Sub-Saharan Africa Move Forward? 99International Institutions in Crisis 102The Rules of War: Entering “No Man’s Land” 103Post-Combat Environments Pose the Biggest Challenge 104Is the United States’ Technological Prowess at Risk? 112How the World Sees the United States 114 7
  • 7. The 2020 Global LandscapeRelative Certainties Key UncertaintiesGlobalization largely irreversible, Whether globalization will pull in lagginglikely to become less Westernized. economies; degree to which Asian countries set new “rules of the game.”World economy substantially larger. Extent of gaps between “haves” and “have-nots”; backsliding by fragile democracies; managing or containing financial crises.Increasing number of global firms Extent to which connectivity challengesfacilitate spread of new technologies. governments.Rise of Asia and advent of possible Whether rise of China/India occurs economic middle-weights.Aging populations in established Ability of EU and Japan to adapt work forces,powers. welfare systems, and integrate migrant populations; whether EU becomes a superpower.Energy supplies “in the ground” Political instability in producer countries; supplysufficient to meet global demand. disruptions.Growing power of nonstate actors. Willingness and ability of states and international institutions to accommodate these actors.Political Islam remains a potent force. Impact of religiosity on unity of states and potential for conflict; growth of jihadist ideology.Improved WMD capabilities of some More or fewer nuclear powers; ability of terroristsstates. to acquire biological, chemical, radiological, or nuclear weapons.Arc of instability spanning Middle Precipitating events leading to overthrow ofEast, Asia, Africa. regimes.Great power conflict escalating into Ability to manage flashpoints and competition fortotal war unlikely. resources.Environmental and ethical issues Extent to which new technologies create or resolveeven more to the fore. ethical dilemmas.US will remain single most powerful Whether other countries will more openlyactor economically, technologically, challenge Washington; whether US loses S&Tmilitarily. edge. 8
  • 8. Executive SummaryAt no time since the formation of the Western alliance system in 1949 have theshape and nature of international alignments been in such a state of flux. The endof the Cold War shifted the tectonic plates, but the repercussions from these momentousevents are still unfolding. Emerging powers in Asia, retrenchment in Eurasia, a roilingMiddle East, and transatlantic divisions are among the issues that have only come to ahead in recent years. The very magnitude and speed of change resulting from aglobalizing world—apart from its precise character—will be a defining feature of theworld out to 2020. Other significant characteristics include: the rise of new powers, newchallenges to governance, and a more pervasive sense of insecurity, including terrorism.As we map the future, the prospects for increasing global prosperity and the limitedlikelihood of great power conflict provide an overall favorable environment for copingwith what are otherwise daunting challenges. The role of the United States will be animportant variable in how the world is shaped, influencing the path that states andnonstate actors choose to follow.New Global PlayersThe likely emergence of China and India, as well as others, as new major globalplayers—similar to the advent of a united Germany in the 19th century and apowerful United States in the early 20th century—will transform the geopoliticallandscape, with impacts potentially as dramatic as those in the previous twocenturies. In the same way that commentators refer to the 1900s as the “AmericanCentury,” the 21st century may be seen as the time when Asia, led by China and India,comes into its own. A combination of sustained high economic growth, expandingmilitary capabilities, and large populations will be at the root of the expected rapid rise ineconomic and political power for both countries.• Most forecasts indicate that by 2020 China’s gross national product (GNP) will exceed that of individual Western economic powers except for the United States. India’s GNP will have overtaken or be on the threshold of overtaking European economies.• Because of the sheer size of China’s and India’s populations—projected by the US Census Bureau to be 1.4 billion and almost 1.3 billion respectively by 2020—their standard of living need not approach Western levels for these countries to become important economic powers.Barring an abrupt reversal of the process of globalization or any major upheavals inthese countries, the rise of these new powers is a virtual certainty. Yet how China andIndia exercise their growing power and whether they relate cooperatively orcompetitively to other powers in the international system are key uncertainties. Theeconomies of other developing countries, such as Brazil, could surpass all but thelargest European countries by 2020; Indonesia’s economy could also approach theeconomies of individual European countries by 2020. 9
  • 9. By most measures—market size, single currency, highly skilled work force, stabledemocratic governments, and unified trade bloc—an enlarged Europe will be able toincrease its weight on the international scene. Europe’s strength could be in providing amodel of global and regional governance to the rising powers. But aging populationsand shrinking work forces in most countries will have an important impact on thecontinent. Either European countries adapt their work forces, reform their socialwelfare, education, and tax systems, and accommodate growing immigrant populations(chiefly from Muslim countries), or they face a period of protracted economic stasis.Japan faces a similar aging crisis that could crimp its longer run economic recovery, butit also will be challenged to evaluate its regional status and role. Tokyo may have tochoose between “balancing” against or “bandwagoning” with China. Meanwhile, thecrisis over North Korea is likely to come to a head sometime over the next 15 years.Asians’ lingering resentments and concerns over Korean unification and cross-TaiwanStrait tensions point to a complicated process for achieving regional equilibrium.Russia has the potential to enhance its international role with others due to its positionas a major oil and gas exporter. However, Russia faces a severe demographic crisisresulting from low birth rates, poor medical care, and a potentially explosive AIDSsituation. To the south, it borders an unstable region in the Caucasus and Central Asia,the effects of which—Muslim extremism, terrorism, and endemic conflict—are likely tocontinue spilling over into Russia. While these social and political factors limit theextent to which Russia can be a major global player, Moscow is likely to be an importantpartner both for the established powers, the United States and Europe, and for therising powers of China and India.With these and other new global actors, how we mentally map the world in 2020 willchange radically. The “arriviste” powers—China, India, and perhaps others such asBrazil and Indonesia—have the potential to render obsolete the old categories of Eastand West, North and South, aligned and nonaligned, developed and developing.Traditional geographic groupings will increasingly lose salience in international relations.A state-bound world and a world of mega-cities, linked by flows of telecommunications,trade and finance, will co-exist. Competition for allegiances will be more open, lessfixed than in the past.Impact of GlobalizationWe see globalization—growing interconnectedness reflected in the expanded flows ofinformation, technology, capital, goods, services, and people throughout the world—asan overarching “mega-trend,” a force so ubiquitous that it will substantially shapeall the other major trends in the world of 2020. But the future of globalization is notfixed; states and nonstate actors—including both private companies and NGOs—willstruggle to shape its contours. Some aspects of globalization—such as the growingglobal interconnectedness stemming from the information technology (IT) revolution—almost certainly will be irreversible. Yet it is also possible, although unlikely, that theprocess of globalization could be slowed or even stopped, just as the era of globalization 10
  • 10. in the late 19th and early 20th centuries was reversed by catastrophic war and globaldepression.Barring such a turn of events, the world economy is likely to continue growingimpressively: by 2020, it is projected to be about 80 percent larger than it was in2000, and average per capita income will be roughly 50 percent higher. Of course,there will be cyclical ups and downs and periodic financial or other crises, but this basicgrowth trajectory has powerful momentum behind it. Most countries around the world,both developed and developing, will benefit from gains in the world economy. Byhaving the fastest-growing consumer markets, more firms becoming world-classmultinationals, and greater S&T stature, Asia looks set to displace Western countries asthe focus for international economic dynamism—provided Asia’s rapid economic growthcontinues.Yet the benefits of globalization won’t be global. Rising powers will see exploitingthe opportunities afforded by the emerging global marketplace as the best way to asserttheir great power status on the world stage. In contrast, some now in the “First World”may see the closing gap with China, India, and others as evidence of a relative decline,even though the older powers are likely to remain global leaders out to 2020. TheUnited States, too, will see its relative power position eroded, though it will remain in2020 the most important single country across all the dimensions of power. Those leftbehind in the developing world may resent China and India’s rise, especially if they feelsqueezed by their growing dominance in key sectors of the global marketplace. Andlarge pockets of poverty will persist even in “winner” countries.The greatest benefits of globalization will accrue to countries and groups that canaccess and adopt new technologies. Indeed, a nation’s level of technologicalachievement generally will be defined in terms of its investment in integrating andapplying the new, globally available technologies—whether the technologies areacquired through a country’s own basic research or from technology leaders. Thegrowing two-way flow of high-tech brain power between the developing world and theWest, the increasing size of the information computer-literate work force in somedeveloping countries, and efforts by global corporations to diversify their high-techoperations will foster the spread of new technologies. High-tech breakthroughs—suchas in genetically modified organisms and increased food production—could provide asafety net eliminating the threat of starvation and ameliorating basic quality of life issuesfor poor countries. But the gap between the “haves” and “have-nots” will widen unlessthe “have-not” countries pursue policies that support application of new technologies—such as good governance, universal education, and market reforms.Those countries that pursue such policies could leapfrog stages of development,skipping over phases that other high-tech leaders such as the United States and Europehad to traverse in order to advance. China and India are well positioned to becometechnology leaders, and even the poorest countries will be able to leverageprolific, cheap technologies to fuel—although at a slower rate—their owndevelopment. 11
  • 11. • The expected next revolution in high technology involving the convergence of nano-, bio-, information and materials technology could further bolster China and India’s prospects. Both countries are investing in basic research in these fields and are well placed to be leaders in a number of key fields. Europe risks slipping behind Asia in some of these technologies. The United States is still in a position to retain its overall lead, although it must increasingly compete with Asia to retain its edge and may lose significant ground in some sectors.More firms will become global, and those operating in the global arena will bemore diverse, both in size and origin, more Asian and less Western in orientation.Such corporations, encompassing the current, large multinationals, will beincreasingly outside the control of any one state and will be key agents of changein dispersing technology widely, further integrating the world economy, andpromoting economic progress in the developing world. Their ranks will include agrowing number based in such countries as China, India, or Brazil. While NorthAmerica, Japan, and Europe might collectively continue to dominate internationalpolitical and financial institutions, globalization will take on an increasingly non-Westerncharacter. By 2020, globalization could be equated in the popular mind with a risingAsia, replacing its current association with Americanization.An expanding global economy will increase demand for many raw materials, such as oil.Total energy consumed probably will rise by about 50 percent in the next two decadescompared to a 34 percent expansion from 1980-2000, with a greater share provided bypetroleum. Most experts assess that with substantial investment in new capacity,overall energy supplies will be sufficient to meet global demands. But on the supplyside, many of the areas—the Caspian Sea, Venezuela, and West Africa—that are beingcounted on to provide increased output involve substantial political or economic risk.Traditional suppliers in the Middle East are also increasingly unstable. Thus sharperdemand-driven competition for resources, perhaps accompanied by a majordisruption of oil supplies, is among the key uncertainties.• China, India, and other developing countries’ growing energy needs suggest a growing preoccupation with energy, shaping their foreign policies.• For Europe, an increasing preference for natural gas may reinforce regional relationships—such as with Russia or North Africa—given the interdependence of pipeline delivery.New Challenges to GovernanceThe nation-state will continue to be the dominant unit of the global order, buteconomic globalization and the dispersion of technologies, especiallyinformation technologies, will place enormous new strains on governments.Growing connectivity will be accompanied by the proliferation of virtual communities ofinterest, complicating the ability of states to govern. The Internet in particular will spur 12
  • 12. the creation of even more global movements, which may emerge as a robust force ininternational affairs.Part of the pressure on governance will come from new forms of identity politicscentered on religious convictions. In a rapidly globalizing world experiencing populationshifts, religious identities provide followers with a ready-made community that serves asa “social safety net” in times of need—particularly important to migrants. In particular,political Islam will have a significant global impact leading to 2020, rallyingdisparate ethnic and national groups and perhaps even creating an authority thattranscends national boundaries. A combination of factors—youth bulges in manyArab states, poor economic prospects, the influence of religious education, and theIslamization of such institutions as trade unions, nongovernmental organizations, andpolitical parties—will ensure that political Islam remains a major force.• Outside the Middle East, political Islam will continue to appeal to Muslim migrants who are attracted to the more prosperous West for employment opportunities but do not feel at home in what they perceive as an alien and hostile culture.Regimes that were able to manage the challenges of the 1990s could be overwhelmedby those of 2020. Contradictory forces will be at work: authoritarian regimes will facenew pressures to democratize, but fragile new democracies may lack the adaptivecapacity to survive and develop.The so-called “third wave” of democratization may be partially reversed by2020—particularly among the states of the former Soviet Union and in SoutheastAsia, some of which never really embraced democracy. Yet democratization andgreater pluralism could gain ground in key Middle Eastern countries which thus far havebeen excluded from the process by repressive regimes.With migration on the increase in several places around the world—from North Africaand the Middle East into Europe, Latin America and the Caribbean into the UnitedStates, and increasingly from Southeast Asia into the northern regions—more countrieswill be multi-ethnic and will face the challenge of integrating migrants into their societieswhile respecting their ethnic and religious identities.Chinese leaders will face a dilemma over how much to accommodate pluralisticpressures to relax political controls or risk a popular backlash if they do not. Beijingmay pursue an “Asian way of democracy,” which could involve elections at the locallevel and a consultative mechanism on the national level, perhaps with the CommunistParty retaining control over the central government.With the international system itself undergoing profound flux, some of theinstitutions that are charged with managing global problems may beoverwhelmed by them. Regionally based institutions will be particularly challenged tomeet the complex transnational threats posed by terrorism, organized crime, and WMDproliferation. Such post-World War II creations as the United Nations and the 13
  • 13. international financial institutions risk sliding into obsolescence unless they adjust to theprofound changes taking place in the global system, including the rise of new powers.Pervasive InsecurityWe foresee a more pervasive sense of insecurity—which may be as much based onpsychological perceptions as physical threats—by 2020. Even as most of the worldgets richer, globalization will profoundly shake up the status quo—generatingenormous economic, cultural, and consequently political convulsions. With thegradual integration of China, India, and other emerging countries into the globaleconomy, hundreds of millions of working-age adults will become available foremployment in what is evolving into a more integrated world labor market.• This enormous work force—a growing portion of which will be well educated—will be an attractive, competitive source of low-cost labor at the same time that technological innovation is expanding the range of globally mobile occupations.• The transition will not be painless and will hit the middle classes of the developed world in particular, bringing more rapid job turnover and requiring professional retooling. Outsourcing on a large scale would strengthen the anti- globalization movement. Where these pressures lead will depend on how political leaders respond, how flexible labor markets become, and whether overall economic growth is sufficiently robust to absorb a growing number of displaced workers.Weak governments, lagging economies, religious extremism, and youth bulgeswill align to create a perfect storm for internal conflict in certain regions. Thenumber of internal conflicts is down significantly since the late 1980s and early 1990swhen the breakup of the Soviet Union and Communist regimes in Central Europeallowed suppressed ethnic and nationalistic strife to flare. Although a leveling off pointhas been reached where we can expect fewer such conflicts than during the lastdecade, the continued prevalence of troubled and institutionally weak states means thatsuch conflicts will continue to occur.Some internal conflicts, particularly those that involve ethnic groups straddling nationalboundaries, risk escalating into regional conflicts. At their most extreme, internalconflicts can result in failing or failed states, with expanses of territory and populationsdevoid of effective governmental control. Such territories can become sanctuaries fortransnational terrorists (such as al-Qa’ida in Afghanistan) or for criminals and drugcartels (such as in Colombia).The likelihood of great power conflict escalating into total war in the next 15 yearsis lower than at any time in the past century, unlike during previous centurieswhen local conflicts sparked world wars. The rigidities of alliance systems beforeWorld War I and during the interwar period, as well as the two-bloc standoff during theCold War, virtually assured that small conflicts would be quickly generalized. Thegrowing dependence on global financial and trade networks will help deter interstate 14
  • 14. conflict but does not eliminate the possibility. Should conflict occur that involved one ormore of the great powers, the consequences would be significant. The absence ofeffective conflict resolution mechanisms in some regions, the rise of nationalism insome states, and the raw emotions and tensions on both sides of some issues—forexample, the Taiwan Strait or India/Pakistan issues—could lead to miscalculation.Moreover, advances in modern weaponry—longer ranges, precision delivery, and moredestructive conventional munitions—create circumstances encouraging the preemptiveuse of military force.Current nuclear weapons states will continue to improve the survivability of theirdeterrent forces and almost certainly will improve the reliability, accuracy, and lethalityof their delivery systems as well as develop capabilities to penetrate missile defenses.The open demonstration of nuclear capabilities by any state would further discredit thecurrent nonproliferation regime, cause a possible shift in the balance of power, andincrease the risk of conflicts escalating into nuclear ones. Countries without nuclearweapons—especially in the Middle East and Northeast Asia—might decide toseek them as it becomes clear that their neighbors and regional rivals are doingso. Moreover, the assistance of proliferators will reduce the time required for additionalcountries to develop nuclear weapons.Transmuting International TerrorismThe key factors that spawned international terrorism show no signs of abatingover the next 15 years. Facilitated by global communications, the revival of Muslimidentity will create a framework for the spread of radical Islamic ideology inside andoutside the Middle East, including Southeast Asia, Central Asia and Western Europe,where religious identity has traditionally not been as strong. This revival has beenaccompanied by a deepening solidarity among Muslims caught up in national orregional separatist struggles, such as Palestine, Chechnya, Iraq, Kashmir, Mindanao,and southern Thailand, and has emerged in response to government repression,corruption, and ineffectiveness. Informal networks of charitable foundations,madrassas, hawalas1, and other mechanisms will continue to proliferate and beexploited by radical elements; alienation among unemployed youths will swell the ranksof those vulnerable to terrorist recruitment.We expect that by 2020 al-Qa’ida will be superceded by similarly inspired Islamicextremist groups, and there is a substantial risk that broad Islamic movements akin toal-Qa’ida will merge with local separatist movements. Information technology, allowingfor instant connectivity, communication, and learning, will enable the terrorist threat tobecome increasingly decentralized, evolving into an eclectic array of groups, cells, andindividuals that do not need a stationary headquarters to plan and carry out operations.Training materials, targeting guidance, weapons know-how, and fund-raising willbecome virtual (i.e., online).1 Hawalas constitute an informal banking system. 15
  • 15. Terrorist attacks will continue to primarily employ conventional weapons, incorporatingnew twists and constantly adapting to counterterrorist efforts. Terrorists probably will bemost original not in the technologies or weapons they use but rather in their operationalconcepts—i.e., the scope, design, or support arrangements for attacks.Strong terrorist interest in acquiring chemical, biological, radiological and nuclearweapons increases the risk of a major terrorist attack involving WMD. Our greatestconcern is that terrorists might acquire biological agents or, less likely, a nucleardevice, either of which could cause mass casualties. Bioterrorism appearsparticularly suited to the smaller, better-informed groups. We also expect that terroristswill attempt cyber attacks to disrupt critical information networks and, even more likely,to cause physical damage to information systems.Possible FuturesIn this era of great flux, we see several ways in which major global changes could takeshape in the next 15 years, from seriously challenging the nation-state system toestablishing a more robust and inclusive globalization. In the body of this paper wedevelop these concepts in four fictional scenarios which were extrapolated from the keytrends we discuss in this report. These scenarios are not meant as actual forecasts,but they describe possible worlds upon whose threshold we may be entering,depending on how trends interweave and play out:• Davos World provides an illustration of how robust economic growth, led by China and India, over the next 15 years could reshape the globalization process—giving it a more non-Western face and transforming the political playing field as well.• Pax Americana takes a look at how US predominance may survive the radical changes to the global political landscape and serve to fashion a new and inclusive global order.• A New Caliphate provides an example of how a global movement fueled by radical religious identity politics could constitute a challenge to Western norms and values as the foundation of the global system.• Cycle of Fear provides an example of how concerns about proliferation might increase to the point that large-scale intrusive security measures are taken to prevent outbreaks of deadly attacks, possibly introducing an Orwellian world.Of course, these scenarios illustrate just a few of the possible futures that may developover the next 15 years, but the wide range of possibilities we can imagine suggests thatthis period will be characterized by increased flux, particularly in contrast to the relativestasis of the Cold War era. The scenarios are not mutually exclusive: we may see twoor three of these scenarios unfold in some combination or a wide range of otherscenarios. 16
  • 16. Policy ImplicationsThe role of the United States will be an important shaper of the international order in2020. Washington may be increasingly confronted with the challenge of managing—atan acceptable cost to itself—relations with Europe, Asia, the Middle East, and othersabsent a single overarching threat on which to build consensus. Although thechallenges ahead will be daunting, the United States will retain enormousadvantages, playing a pivotal role across the broad range of issues—economic,technological, political, and military—that no other state will match by 2020.Some trends we probably can bank on include dramatically altered alliances andrelationships with Europe and Asia, both of which formed the bedrock of US power inthe post-World War II period. The EU, rather than NATO, will increasingly become theprimary institution for Europe, and the role which Europeans shape for themselves onthe world stage is most likely to be projected through it. Dealing with the US-Asiarelationship may arguably be more challenging for Washington because of the greaterflux resulting from the rise of two world-class economic and political giants yet to be fullyintegrated into the international order. Where US-Asia relations lead will result as muchor more from what the Asians work out among themselves as any action byWashington. One could envisage a range of possibilities from the US enhancing its roleas balancer between contending forces to Washington being seen as increasinglyirrelevant.The US economy will become more vulnerable to fluctuations in the fortunes of othersas global commercial networking deepens. US dependence on foreign oil supplies alsomakes it more vulnerable as the competition for secure access grows and the risks ofsupply side disruptions increase.While no single country looks within striking distance of rivaling US militarypower by 2020, more countries will be in a position to make the United States paya heavy price for any military action they oppose. The possession of chemical,biological, and/or nuclear weapons by Iran and North Korea and the possibleacquisition of such weapons by others by 2020 also increase the potential cost of anymilitary action by the US against them or their allies.The success of the US-led counterterrorism campaign will hinge on the capabilities andresolve of individual countries to fight terrorism on their own soil. Counterterrorismefforts in the years ahead—against a more diverse set of terrorists who are connectedmore by ideology than by geography—will be a more elusive challenge than focusing ona centralized organization such as al-Qa’ida. A counterterrorism strategy thatapproaches the problem on multiple fronts offers the greatest chance ofcontaining—and ultimately reducing—the terrorist threat. The development ofmore open political systems and representation, broader economic opportunities, andempowerment of Muslim reformers would be viewed positively by the broad Muslimcommunities who do not support the radical agenda of Islamic extremists. 17
  • 17. Even if the numbers of extremists dwindle, however, the terrorist threat is likely toremain. The rapid dispersion of biological and other lethal forms of technologyincreases the potential for an individual not affiliated with any terrorist group to be ableto wreak widespread loss of life. Despite likely high-tech breakthroughs that will make iteasier to track and detect terrorists at work, the attacker will have an easier job than thedefender because the defender must prepare against a large array of possibilities.The United States probably will continue to be called on to help manage such conflictsas Palestine, North Korea, Taiwan, and Kashmir to ensure they do not get out of hand ifa peace settlement cannot be reached. However, the scenarios and trends we analyzein the paper suggest the possibility of harnessing the power of the new players incontributing to global security and relieving the US of some of the burden.Over the next 15 years the increasing centrality of ethical issues, old and new,have the potential to divide worldwide publics and challenge US leadership.These issues include the environment and climate change, privacy, cloning andbiotechnology, human rights, international law regulating conflict, and the role ofmultilateral institutions. The United States increasingly will have to battle world publicopinion, which has dramatically shifted since the end of the Cold War. Some of thecurrent anti-Americanism is likely to lessen as globalization takes on more of a non-Western face. At the same time, the younger generation of leaders—unlike during thepost-World War II period—has no personal recollection of the United States as its“liberator” and is more likely to diverge with Washington’s thinking on a range of issues.In helping to map out the global future, the United States will have many opportunities toextend its advantages, particularly in shaping a new international order that integratesdisparate regions and reconciles divergent interests. 18
  • 18. MethodologyTo launch the NIC 2020 Project, in November 2003 we brought together some 25leading outside experts from a wide variety of disciplines and backgrounds to engage ina broad-gauged discussion with Intelligence Community analysts. We invited threeleading “futurists”—Ted Gordon of the UN’s Millennium Project; Jim Dewar, Director ofthe RAND Corporation’s Center for Longer Range Global Policy and the Future of theHuman Condition; and Ged Davis, former head of Shell International’s scenariosproject2—to discuss their most recent work and the methodologies they employed tothink about the future. Princeton University historian Harold James gave the keynoteaddress, offering lessons from prior periods of “globalization.”We surveyed and studied various methodologies (see box on page 22) and reviewed anumber of recent “futures” studies. Besides convening a meeting of counterparts in theUK, Canada, Australia, and New Zealand to learn their thinking, we organized sixregional conferences in countries on four continents—one in the United Kingdom, SouthAfrica, Singapore, and Chile, two in Hungary—to solicit the views of foreign experts froma variety of backgrounds—academics, business people, government officials, membersof nongovernmental organizations and other institutions—who could speakauthoritatively on the key drivers of change and conceptualize broad regional themes.Our regional experts also contributed valuable insights on how the rest of the worldviews the United States. In addition to the conferences held overseas, which includedhundreds of foreign participants, we held a conference in the Washington, DC area onIndia.We augmented these discussions with conferences and workshops that took a more in-depth view of specific issues of interest, including new technologies, the changingnature of warfare, identity politics, gender issues, climate change and many others (seebox on page 20 for a complete list of the conferences). Participants explored key trendsthat were presented by experts and then developed alternative scenarios for how thetrends might play out over the next 15 years. And we consulted numerous organizationsand individuals on the substantive aspects of this study, as well as on methodologiesand approaches for thinking about the future.• The UN Millennium Project—an independent body that advises the UN on strategies for achieving the Millennium development goals—provided invaluable data on cross- cutting issues. We also consulted the Eurasia Group, Oxford Analytica, CENTRA Technologies, and the Stimson Center.• Other individual scholars we consulted included Michael F. Oppenheimer, President, Global Scenarios, who facilitated several of our sessions and informed our thinking on methodologies; Georgetown and now Princeton Professor John Ikenberry, who organized several seminars of academic experts over the course of more than a2 Shell International Limited has for decades used scenarios to identify business risks and opportunities. Ged Davisled this effort for many years. 19
  • 19. year to examine various aspects of US preeminence and critique preliminary drafts of the report; Enid Schoettle, who was one of the architects of Global Trends 2015; Professor Barry B. Hughes, Graduate School of International Studies, University of Denver, whose related statistical and scenario work is featured on our Web site; Anne Solomon, Senior Adviser on Technology Policy and Director of the Biotechnology and Public Policy Program at the Center for Strategic and International Studies in Washington, DC, who organized several stimulating conferences on S&T topics; Elke Matthews, an independent contractor who conducted substantial open-source research; Philip Jenkins, Distinguished Professor of History and Religious Studies, Pennsylvania State University, who provided invaluable insights on global trends pertaining to religion; Nicholas Eberstadt, Henry Wendt Chair in Political Economy, American Enterprise Institute, who provided us with important perspectives on demographic issues; and Jeffrey Herbst, Chair, Department of Politics, Princeton University, who was instrumental in our analysis of issues pertaining to Africa.NIC 2020 Project Conferences and WorkshopsPresentation by Joint Doctrine and Concepts Center (MoD/UK)—CIA Headquarters (September2003)Conference on Anti-Americanism—Wye Plantation (October 2003)Inaugural NIC 2020 Project Conference—Washington, DC (November 2003)Professor Ikenberry’s series of International Relations Roundtables—Georgetown University(November 2003-November 2004)Joint US-Commonwealth Intelligence Officials’ Conference —Washington, DC (December 2003)African Experts’ Roundtable—Washington, DC (January 2004)Middle East NIC 2020 Workshop—Wilton Park, UK (March 2004)Africa NIC 2020 Workshop—Johannesburg, South Africa (March 2004)Global Evolution of Dual-Use Biotechnology—Washington, DC (March 2004)Russia and Eurasia NIC 2020 Workshop—Budapest, Hungary (April 2004)Europe NIC 2020 Workshop—Budapest, Hungary (April 2004)Global Identity Roundtable Discussion—CIA Headquarters (May 2004)Asia NIC 2020 Workshop—Singapore (May 2004)Conference on The Changing Nature of Warfare—Center for Naval Analysis (May 2004)Latin America NIC 2020 Workshop—Santiago, Chile (June 2004)Technological Frontiers, Global Power, Wealth, and Conflict—Center for Strategic andInternational Studies (CSIS) (June 2004)Climate Change—University of Maryland (June 2004)NSA Tech 2020—Baltimore, Maryland (June 2004)Conference on Muslims in Europe—Oxford, England (July 2004)Women in 2020—Washington, DC (August 2004)Business Leader Roundtable Discussion—CIA Headquarters (September 2004)India and Geopolitics in 2020–Rosslyn, Virginia (September 2004)Stimson Center-sponsored roundtables on Scenarios—Washington, DC (Spring-Summer, 2004)Information and Communications, Technological and Social Cohesion and the Nation-State—Washington, DC (September 2004)Wrap-Up NIC 2020 Project Workshop—Virginia (October 2004)Consultation on Preliminary NIC 2020 Draft with UK experts and the International Institute ofStrategic Studies—London, England (October 2004) 20
  • 20. • The following organizations arranged the regional conferences for the project: Wilton Park, Central European University, Bard College, the South African Institute for International Affairs, Adolfo Ibañez University, Nueva Mayoria, and the Asia Society. Timothy Sharp and Professor Ewan Anderson of Sharp Global Solutions Ltd arranged a conference in London of UK experts to critique a preliminary draft of the report.• We also want to thank our colleagues in the US Intelligence Community, who provided us with useful data and shared their ideas about global trends.Scenario Development ProcessWhile straight-line projections are useful in establishing a baseline and positing amainline scenario, they typically present a one-dimensional view of how the future mightunfold and tend to focus attention exclusively on the “prediction.” Scenarios offer amore dynamic view of possible futures and focus attention on the underlying interactionsthat may have particular policy significance. They are especially useful in thinking aboutthe future during times of great uncertainty, which we believe is the case for the next 15years. Scenarios help decisionmakers to break through conventional thinking and basicassumptions so that a broader range of possibilities can be considered—including newrisks and opportunities.The six international workshops generated an enormous amount of data and analysis onthe key drivers that are likely to lead to regional change in the 2020 timeframe. The NIC2020 Project staff conducted additional research, drafted papers, and initiated follow-uproundtable discussions and conferences. We analyzed the findings from the regionalworkshops, highlighted key regional trends that had global implications, and looked atthe regional product in its totality to identify salient cross-regional trends. These keyfindings were set aside as the raw material for development of the global scenarios.To jumpstart the global scenario development process, the NIC 2020 Project staffcreated a Scenario Steering Group (SSG)—a small aggregation of respected membersof the policy community, think tanks, and analysts from within the IntelligenceCommunity—to examine summaries of the data collected and consider scenarioconcepts that take into account the interaction between key drivers of global change.SSG examined the product of the international workshops and explored fledglingscenarios for plausibility and policy relevance.We studied extensively key futures work developed in the public and private sectors thatemployed scenario techniques, identified the “best practices,” and then developed ourown unique approach, combining trend analysis and scenarios. Papers that influencedour work include those produced by Goldman Sachs, the UK Ministry of Defense, andShell International, Ltd. (see box on page 22). 21
  • 21. Scenario and Futures Work That Influenced Our ThinkingOur consultations with Ged Davis, formerly the leader of Shell International’s scenario-building effort, affirmed our intent to develop scenarios for policymakers. Shell buildsglobal scenarios every three years to help its leaders make better decisions.Following initial research, Shell’s team spends about a year conductinginterviews and holding workshops to develop and finalize the scenarios, seekingthroughout the process to ensure a balance between unconventional thinking andplausibility. We used a similar approach. We also benefited from consultationswith other organizations that do futures work:The Joint Doctrine and Concepts Centre, an integral part of the UK Ministry ofDefense, undertook an ambitious attempt to develop a coherent view of how the worldmight develop over the next 30 years in ways that could alter the UK’s security. Theproject—Strategic Trends—was designed to assist the MOD in gaining a strategicunderstanding of future threats, risks, challenges, and opportunities.Meta-Analysis of Published Material on Drivers and Trends, produced by the UKDefense Evaluation and Research Agency, reviewed over 50 futures studies.The RAND Corporation—as part of a parallel, NIC-sponsored effort to update its 2001monograph The Global Revolution: Bio/Nano/Materials Trends and Their Synergies withIT by 2015—provided substantive guidance by delineating technology trends and theirinteraction; identifying applications that will transform the future; commentingextensively on drafts; and providing thought-provoking, technology-driven scenarioconcepts.Peter Schwartz, Chairman, Global Business Network and author of InevitableSurprises, provided us with invaluable insights on the nature of surprise, including theuse of drivers, the interpretation of insights across disciplines, and the application ofscenario work to the private sector.Toffler Associates contributed ideas at several points, including in association with theNSA Tech 2020 project (see below). In addition, Drs. Alvin and Heidi Tofflerparticipated in our capstone conference, sharing their insights on understanding thefuture based on their vast experience in the field.The National Security Agency’s project—Tech 2020—also helped identify keytechnology convergences expected to impact society between now and 2020. We haveincorporated valuable insights from this project and are grateful to NSA for stimulating arewarding Intelligence Community dialogue on future trends. 22
  • 22. After scenario concepts were explored, critiqued, and debated within the SSG and withother groups that the NIC engaged, eight global scenarios that held particular promisewere developed. The NIC then held a wrap-up workshop with a broader group ofexperts to examine the eight scenarios, discuss the merits and weaknesses of each,and ultimately narrow the number of scenarios included in the final publication to four.The scenarios depicted in this publication were selected for their relevance topolicymakers and because they cause us to question key assumptions about thefuture—but they do not attempt to predict it. Nor are they mutually exclusive.Interactive ToolsSignificantly, the NIC 2020 Project also employs information technology and analytictools unavailable in earlier NIC efforts. Its global sweep and scope required that weengage in a continuing, worldwide dialogue about the future. With the help of CENTRATechnologies, we created an interactive, password-protected Web site to serve as arepository for discussion papers and workshop summaries. The site also provided alink to massive quantities of basic data for reference and analysis. It containedinteractive tools to keep our foreign and domestic experts engaged and created “hands-on” computer simulations that allowed novice and expert alike to develop their ownscenarios.3 Much of this supporting material involving the Empirical Web-boxesScenario capability has now been transferred to the open, unclassified NIC Web sitewith publication of this report.3 To access these new innovations log on to the NIC website: 23
  • 23. 24
  • 24. IntroductionThe international order is in the midst of • The accelerating pace of scientificprofound change: at no time since the change and the dispersion of dual-formation of the Western alliance system use 1949 have the shape and nature ofinternational alignments been in such a • Lingering social inequalities.state of flux as they have during the pastdecade. As a result, the world of 2020 • Emerging powers.will differ markedly from the world of2004, and in the intervening years the • The global aging phenomenon.United States will face majorinternational challenges that differ • Halting democratization.significantly from those we face today.The very magnitude and speed of • A spreading radical Islamic ideology.change resulting from a globalizingworld—regardless of its precise • The potential for catastrophiccharacter—will be a defining feature of terrorism.the world out to 2020. Other significantcharacteristics include: • The proliferation of weapons of mass destruction.• The contradictions of globalization. • Increased pressures on international• Rising powers: the changing institutions. geopolitical landscape. As we survey the next 15 years, the role• New challenges to governance. of the United States will be an important variable in how the world is shaped,• A more pervasive sense of insecurity. influencing the path that states and nonstate actors choose to follow. InAs with previous upheavals, the seeds of addition to the pivotal role of the Unitedmajor change have been laid in the States, international bodies includingtrends apparent today. Underlying the international organizations, multinationalbroad characteristics listed above are a corporations, nongovernmentalnumber of specific trends that overlap organizations (NGOs) and others canand play off each other: mitigate distinctly negative trends, such as greater insecurity, and advance• The expanding global economy. positive trends. 25
  • 25. 26
  • 26. The Contradictions of GlobalizationWhereas in Global Trends 2015 we governments would find difficult toviewed globalization—growing expunge.interconnectedness reflected in theexpanded flows of information, • It will be difficult, too, to turn off thetechnology, capital, goods, services, and phenomenon of entrenched economicpeople throughout the world—as among interdependence, although the pace ofan array of key drivers, we now view it global economic expansion may ebbmore as a “mega-trend”—a force so and flow. Interdependence hasubiquitous that it will substantially shape widened the effective reach ofall of the other major trends in the world of multinational business, enabling2020. smaller firms as well as large multinationals to market across “[By 2020] globalization is likely borders and bringing heretofore non- to take on much more of a ‘non- traded services into the international arena. Western’ face…” Yet the process of globalization, powerfulThe reach of globalization was as it is, could be substantially slowed orsubstantially broadened during the last 20 even reversed, just as the era ofyears by Chinese and Indian economic globalization in the late 19th and early 20thliberalization, the collapse of the Soviet centuries was reversed by catastrophicUnion, and the worldwide information war and global depression. Sometechnology revolution. Through the next features that we associate with the15 years, it will sustain world economic globalization of the 1990s—such asgrowth, raise world living standards, and economic and political liberalization—aresubstantially deepen global interdepen- prone to “fits and starts” and probably willdence. At the same time, it will profoundly depend on progress in multilateralshake up the status quo almost negotiations, improvements in nationaleverywhere—generating enormous governance, and the reduction ofeconomic, cultural, and consequently conflicts. The freer flow of people acrosspolitical convulsions. national borders will continue to face social and political obstacles even whenCertain aspects of globalization, such as there is a pressing need for migrantthe growing global inter-connectedness workers.stemming from the information technologyrevolution, are likely to be irreversible.Real-time communication, which has “India and China probably will betransformed politics almost everywhere, is among the economica phenomenon that even repressive heavyweights or ‘haves.’” 27
  • 27. What Would An Asian Face on Globalization Look Like?Rising Asia will continue to reshape globalization, giving it less of a “Made in the USA” characterand more of an Asian look and feel. At the same time, Asia will alter the rules of the globalizingprocess. By having the fastest-growing consumer markets, more firms becoming world-classmultinationals, and greater S&T stature, Asia looks set to displace Western countries as thefocus for international economic dynamism—provided Asia’s rapid economic growth continues.Asian finance ministers have considered establishing an Asian monetary fund that wouldoperate along different lines from IMF, attaching fewer strings on currency swaps and givingAsian decision-makers more leeway from the “Washington macro-economic consensus.”• In terms of capital flows, rising Asia may still accumulate large currency reserves—currently $850 billion in Japan, $500 billion in China, $190 billion in Korea, and $120 billion in India, or collectively three-quarters of global reserves—but the percentage held in dollars will fall. A basket of reserve currencies including the yen, renminbi, and possibly rupee probably will become standard practice.• Interest-rate decisions taken by Asian central bankers will impact other global financial markets, including New York and London, and the returns from Asian stock markets are likely to become an increasing global benchmark for portfolio managers.As governments devote more resources to basic research and development, rising Asia willcontinue to attract applied technology from around the world, including cutting-edge technology,which should boost their high performance sectors. We already anticipate (as stated in the text)that the Asian giants may use the power of their markets to set industry standards, rather thanadopting those promoted by Western nations or international standards bodies. Theinternational intellectual property rights regime will be profoundly molded by IPR regulatory andlaw enforcement practices in East and South Asia.Increased labor force participation in the global economy, especially by China, India, andIndonesia, will have enormous effects, possibly spurring internal and regional migrations. Eitherway it will have a large impact, determining the relative size of the world’s greatest new “mega-cities” and, perhaps, act as a key variable for political stability/instability for decades to come.To the degree that these vast internal migrations spill over national borders—currently, only aminiscule fraction of China’s 100 million internal migrants end up abroad—they could havemajor repercussions for other regions, including Europe and North America.An expanded Asian-centric cultural identity may be the most profound effect of a rising Asia.Asians have already begun to reduce the percentage of students who travel to Europe andNorth America with Japan and—most striking—China becoming educational magnets. A new,more Asian cultural identity is likely to be rapidly packaged and distributed as incomes rise andcommunications networks spread. Korean pop singers are already the rage in Japan, Japaneseanime have many fans in China, and Chinese kung-fu movies and Bollywood song-and-danceepics are viewed throughout Asia. Even Hollywood has begun to reflect these Asianinfluences—an effect that is likely to accelerate through 2020. 28
  • 28. Moreover, the character of globalization material benefits of globalization,probably will change just as capitalism citizens are opposed to its perceivedchanged over the course of the 19th and “Americanization,” which they see as20th centuries. While today’s most threatening to their cultural andadvanced nations—especially the United religious values. The conflation ofStates—will remain important forces globalization with US values has indriving capital, technology and goods, turn fueled anti-Americanism in someglobalization is likely to take on much parts of the world.more of a “non-Western face” over thenext 15 years. “…the world economy is projected to be about 80 percent• Most of the increase in world population and consumer demand larger in 2020 than it was in through 2020 will take place in today’s 2000, and average per capita developing nations—especially China, income to be roughly 50 percent India, and Indonesia—and higher.” multinational companies from today’s advanced nations will adapt their Currently, about two-thirds of the world’s “profiles” and business practices to the population live in countries that are demands of these cultures. connected to the global economy. Even by 2020, however, the benefits of• Able to disperse technology widely globalization won’t be global. Over the and promote economic progress in the next 15 years, gaps will widen between developing world, corporations already those countries benefiting from are seeking to be “good citizens” by globalization—economically, allowing the retention of non-Western technologically, and socially—and those practices in the workplaces in which underdeveloped nations or pockets within they operate. Corporations are in the nations that are left behind. Indeed, we position to make globalization more see the next 15 years as a period in which palatable to people concerned about the perceptions of the contradictions and preserving unique cultures. uncertainties of a globalized world come even more to the fore than is the case• New or expanding corporations from today. countries lifted up by globalization will make their presence felt globally An Expanding and Integrating Global through trade and investments abroad. Economy The world economy is projected to be• Countries that have benefited and are about 80 percent larger in 2020 than it now in position to weigh in will seek was in 2000 and average per capita more power in international bodies and income to be roughly 50 percent higher. greater influence on the “rules of the Large parts of the world will enjoy game.” unprecedented prosperity, and a numerically large middle class will be• In our interactions, many foreign created for the first time in some formerly experts have noted that while popular poor countries. The social structures in opinion in their countries favors the 29
  • 29. What Could Derail Globalization?The process of globalization, powerful as it is, could be substantially slowed or evenstopped. Short of a major global conflict, which we regard as improbable, anotherlarge-scale development that we believe could stop globalization would be a pandemic.However, other catastrophic developments, such as terrorist attacks, could slow itsspeed.Some experts believe it is only a matter of time before a new pandemic appears, suchas the 1918–1919 influenza virus that killed an estimated 20 million worldwide. Such apandemic in megacities of the developing world with poor health-care systems—in Sub-Saharan Africa, China, India, Bangladesh or Pakistan—would be devastating and couldspread rapidly throughout the world. Globalization would be endangered if the death tollrose into the millions in several major countries and the spread of the disease put a haltto global travel and trade during an extended period, prompting governments to expendenormous resources on overwhelmed health sectors. On the positive side of the ledger,the response to SARS showed that international surveillance and control mechanismsare becoming more adept at containing diseases, and new developments inbiotechnologies hold the promise of continued improvement.A slow-down could result from a pervasive sense of economic and physicalinsecurity that led governments to put controls on the flow of capital, goods, people,and technology that stalled economic growth. Such a situation could come about inresponse to terrorist attacks killing tens or even hundreds of thousands in several UScities or in Europe or to widespread cyber attacks on information technology. Bordercontrols and restrictions on technology exchanges would increase economic transactioncosts and hinder innovation and economic growth. Other developments that couldstimulate similar restrictive policies include a popular backlash against globalizationprompted, perhaps, by white collar rejection of outsourcing in the wealthy countriesand/or resistance in poor countries whose peoples saw themselves as victims ofglobalization.those developing countries will be will be in a position to achieve highertransformed as growth creates a greater economic growth than Europe and Japan,middle class. Over a long time frame, whose aging work forces may inhibit theirthere is the potential, so long as the growth. Given its enormous population—expansion continues, for more and assuming a reasonable degree oftraditionally poor countries to be pulled real currency appreciation—the dollarcloser into the globalization circle. value of China’s gross national product (GNP) may be the second largest in theMost forecasts to 2020 and beyond world by 2020. For similar reasons, thecontinue to show higher annual growth for value of India’s output could match that ofdeveloping countries than for high-income a large European country. Theones. Countries such as China and India economies of other developing countries, 30
  • 30. such as Brazil and Indonesia, could Continued Economic Turbulence.surpass all but the largest European Sustained high-growth rates haveeconomies by 2020.4 historical precedents. China already has had about two decades of 7 percent and• Even with all their dynamic growth, higher growth rates, and Japan, South Asia’s “giants” and others are not likely Korea, and Taiwan have managed in the to compare qualitatively to the past to achieve annual rates averaging economies of the US or even some of around 10 percent for a long period. the other rich countries. They will have some dynamic, world-class Fast-developing countries have sectors, but more of their populations historically suffered sudden setbacks, will work on farms, their capital stocks however, and economic turbulence is will be less sophisticated, and their increasingly likely to spill over and upset financial systems are likely to be less broader international relations. Many efficient than those of other wealthy emerging markets—such as Mexico in countries. the mid-1990s and Asian countries in the late 1990s—suffered negative effects from the abrupt reversals of capital4 Dreaming with the BRICS, Goldman Sachs study, movements, and China and India mayOctober 2003. 31
  • 31. encounter similar problems. The scale of market. World patterns of production,the potential reversals would be trade, employment, and wages will beunprecedented, and it is unclear whether transformed.current international financialmechanisms would be in a position to • This enormous work force—a growingforestall wider economic disruption. portion of which will be well educated—will be an attractive, “Competitive pressures will force competitive source of low-cost labor at companies based in the advanced the same time that technological innovation is expanding the range of economies to ‘outsource’ many globally mobile occupations. blue- and white-collar jobs.” • Competition from these workers willWith the gradual integration of China, increase job “churning,” necessitateIndia, and other developing countries into professional retooling, and restrainthe global economy, hundreds of millions wage growth in some occupations.of working-age adults will join what isbecoming, through trade and investment Where these labor market pressures leadflows, a more interrelated world labor will depend on how political leaders and 32
  • 32. policymakers respond. Against the now—it would be still well below thebackdrop of a global economic recession, 60 percent level for the US. And persuch resources could unleash capita income for China’s middle classwidespread protectionist sentiments. As would be substantially less thanlong as sufficiently robust economic equivalents in the West.growth and labor market flexibility aresustained, however, intense international • In India, there are now estimated to becompetition is unlikely to cause net job some 300 million middle-income“loss” in the advanced economies. earners making $2,000-$4,000 a year. Both the number of middle earners• The large number of new service and their income levels are likely to sector jobs that will be created in India rise rapidly, but their incomes will and elsewhere in the developing continue to be substantially below world, for example, will likely exceed averages in the US and other rich the supply of workers with those countries even by 2020. specific skills in the advanced economies. • However, a $3,000 annual income is considered sufficient to spur car• Job turnover in advanced economies purchases in Asia; thus rapidly rising will continue to be driven more by income levels for a growing middle technological change and the class will combine to mean a huge vicissitudes of domestic rather than consumption explosion, which is international competition. already evident.Mobility and Laggards. Although the Widening income and regional disparitiesliving standards of many people in will not be incompatible with a growingdeveloping and underdeveloped countries middle class and increasing overallwill rise over the next 15 years, per capita wealth. In India, although much of theincomes in most countries will not west and south may have a large middlecompare to those of Western nations by class by 2020, a number of regions such2020. There will continue to be large as Bihar, Uttar Pradesh, and Orissa willnumbers of poor even in the rapidly remain underdeveloped.emerging economies, and the proportionof those in the middle stratum is likely to Moreover, countries not connected to thebe significantly less than is the case for world economy will continue to’s developed nations. Experts Even the most optimistic forecasts admitestimate it could take China another 30 that economic growth fueled byyears beyond 2020 for per capita globalization will leave many countries inincomes to reach current rates in poverty over the next 15 years.developed economies. • Scenarios developed by the World• Even if, as one study estimates, Bank indicate, for example, that Sub- China’s middle class could make up Saharan Africa will be far behind even as much as 40 percent of its under the most optimistic scenario. population by 2020—double what it is The region currently has the largest 33
  • 33. share of people living on less than $1 mitigate some common diseases and per day. stretch lifespans, applications that improve food and potable waterIf the growing problem of abject poverty production, and expansion of wirelessand bad governance in troubled states in communications and language translationSub-Saharan Africa, Eurasia, the Middle technologies that will facilitateEast, and Latin America persists, these transnational business, commercial, andareas will become more fertile grounds even social and political relationships.for terrorism, organized crime, andpandemic disease. Forced migration also Moreover, future technology trends will beis likely to be an important dimension of marked not only by acceleratingany downward spiral. The international advancements in individual technologiescommunity is likely to face choices about but also by a force-multiplyingwhether, how, and at what cost to convergence of the technologies—intervene. information, biological, materials, and nanotechnologies—that have the “…the greatest benefits of potential to revolutionize all dimensions of globalization will accrue to life. Materials enabled with nanotechnology’s sensors and facilitated countries and groups that can by information technology will produce access and adopt new myriad devices that will enhance health technologies.” and alter business practices and models. Such materials will provide newThe Technology Revolution knowledge about environment, improveThe trend toward rapid, global diffusion of security, and reduce privacy. Suchtechnology will continue, although the interactions of these technology trends—stepped-up technology revolution will not coupled with agile manufacturingbenefit everyone equally. methods and equipment as well as energy, water, and transportation• Among the drivers of the growing technologies—will help China’s and availability of technology will be the India’s prospects for joining the “First growing two-way flow of high-tech World.” Both countries are investing in brain power between developing basic research in these fields and are well countries and Western countries, the placed to be leaders in a number of key increasing size of the technologically fields. Europe risks slipping behind Asia literate workforce in some developing in creating some of these technologies. countries, and efforts by multinational The United States is still in a position to corporations to diversify their high- retain its overall lead, although it must tech operations. increasingly compete with Asia and may lose significant ground in some sectors.New technology applications will fosterdramatic improvements in human To Adaptive Nations Go Technology ‘sknowledge and individual well-being. Spoils. The gulf between “haves” andSuch benefits include medical “have-nots” may widen as the greatestbreakthroughs that begin to cure or benefits of globalization accrue to countries and groups that can access and 34
  • 34. adopt new technologies. Indeed, a • Indeed, international IPR enforcementnation’s level of technological is on course for dramatic change.achievement generally will be defined in Countries like China and India will,terms of its investment in integrating and because of the purchasing power ofapplying the new, globally available their huge markets, be able to shapetechnologies—whether the technologies the implementation of someare acquired through a country’s own technologies and step on thebasic research or from technology intellectual property rights of others.leaders. Nations that remain behind in The attractiveness of these largeadopting technologies are likely to be markets will tempt multinational firmsthose that have failed to pursue policies to overlook IPR indiscretions that onlythat support application of new minimally affect their bottom lines.technologies—such as good governance, Additionally, as many of the expecteduniversal education, and market advancements in technology arereforms—and not solely because they are anticipated to be in medicine, therepoor. will be increasing pressure from a humanitarian and moral perspective toThose that employ such policies can “release” the property rights “for theleapfrog stages of development, skipping good of mankind.”over phases that other high-tech leaderssuch as the United States and Europe Nations also will face serious challengeshad to traverse in order to advance. in oversight, control, and prohibition ofChina and India are well positioned to sensitive technologies. With the sameachieve such breakthroughs. Yet, even technology, such as sensors, computing,the poorest countries will be able to communication, and materials,leverage prolific, cheap technologies to increasingly being developed for a rangefuel—although at a slower rate—their of applications in both everyday,own development. commercial settings and in critical military applications the monitoring and control of• As nations like China and India surge the export of technological components forward in funding critical science and will become more difficult. Moreover, engineering education, research, and joint ventures, globalized markets and the other infrastructure investments, they growing proportion of private sector will make considerable strides in capital in basic R&D will undermine manufacturing and marketing a full nation-state efforts to keep tabs on range of technology applications— sensitive technologies. from software and pharmaceuticals to wireless sensors and smart-materials • Questions concerning a country’s products. ethical practices in the technology realm—such as with geneticallyRapid technological advances outside the modified foods, data privacy,United States could enable other biological material research,countries to set the rules for design, concealable sensors, and biometricstandards, and implementation, and for devices—may become an increasinglymolding privacy, information security, and important factor in international tradeintellectual property rights (IPR). policy and foreign relations. 35
  • 35. Biotechnology: Panacea and WeaponThe biotechnological revolution is at a relatively early stage, and major advances in thebiological sciences coupled with information technology will continue to punctuate the21st century. Research will continue to foster important discoveries in innovativemedical and public health technologies, environmental remediation, agriculture,biodefense, and related fields.On the positive side, biotechnology could be a “leveling” agent between developed anddeveloping nations, spreading dramatic economic and healthcare enhancements to theneediest areas of the world.• Possible breakthroughs in biomedicine such as an antiviral barrier will reduce the spread of HIV/AIDS, helping to resolve the ongoing humanitarian crisis in Sub- Saharan Africa and diminishing the potentially serious drag on economic growth in developing countries like India and China. Biotechnology research and innovations derived from continued US investments in Homeland Security—such as new therapies that might block a pathogen’s ability to enter the body—may eventually have revolutionary healthcare applications that extend beyond protecting the US from a terrorist attack.• More developing countries probably will invest in indigenous biotechnology developments, while competitive market pressures increasingly will induce firms and research institutions to seek technically capable partners in developing countries.However, even as the dispersion of biotechnology promises a means of improving thequality of life, it also poses a major security concern. As biotechnology informationbecomes more widely available, the number of people who can potentially misuse suchinformation and wreak widespread loss of life will increase. An attacker would appear tohave an easier job—because of the large array of possibilities available—than thedefender, who must prepare against them all. Moreover, as biotechnology advancesbecome more ubiquitous, stopping the progress of offensive BW programs will becomeincreasingly difficult. Over the next 10 to 20 years there is a risk that advances inbiotechnology will augment not only defensive measures but also offensive biologicalwarfare (BW) agent development and allow the creation of advanced biological agentsdesigned to target specific systems—human, animal, or crop.Lastly, some biotechnology techniques that may facilitate major improvements in healthalso will spur serious ethical and privacy concerns over such matters as comprehensivegenetic profiling; stem cell research; and the possibility of discovering DNA signaturesthat indicate predisposition for disease, certain cognitive abilities, or anti-socialbehavior. 36
  • 36. At the same time, technology will be a to have a lower life expectancy in 2010source of tension in 2020: from than they did in 1990.competition over creating and attractingthe most critical component of Even if effective HIV/AIDS preventiontechnological advancement—people—to measures are adopted in variousresistance among some cultural or countries, the social and economic impactpolitical groups to the perceived privacy- of the millions already infected with therobbing or homogenizing effects of disease will play out over the next 15pervasive technology. years.Lingering Social Inequalities • The rapid rise in adult deaths causedEven with the potential for technological by AIDS has left an unprecedentedbreakthroughs and the dispersion of new number of orphans in Africa. Today intechnologies, which could help reduce some African countries one in teninequalities, significant social welfare children is an orphan, and thedisparities within the developing and situation is certain to worsen.between developing and OECD countrieswill remain until 2020. The debilitation and death of millions of people resulting from the AIDS pandemicOver the next 15 years, illiteracy rates of will have a growing impact on thepeople 15 years and older will fall, economies of the hardest-hit countries,according to UNESCO, but they will still particularly those in Sub-Saharan Africa,be 17 times higher in poor and where more than 20 million are believeddeveloping countries than those in to have died from HIV/AIDS since theOECD5 countries. Moreover, illiteracy early 1980s. Studies show thatrates among women will be almost twice household incomes drop by 50 to 80as high as those among men. Between percent when key earners become1950 and 1980 life expectancy between infected. In “second wave” HIV/AIDSthe more- and less-developed nations countries—Nigeria, Ethiopia, Russia,began to converge markedly; this India, China, Brazil, Ukraine, and theprobably will continue to be the case for Central Asian states—the disease willmany developing countries, including the continue to spread beyond traditionalmost populous. However, by US Census high-risk groups into the generalBureau projections, over 40 countries— population. As HIV/AIDS spreads, it hasincluding many African countries, Central the potential to derail the economicAsian states, and Russia—are projected prospects of many up-and-coming economic powers.5 The OECD, Organization for Economic Cooperationand Development, an outgrowth of the Marshall Plan-era Organization for European Economic Cooperation,boasts 30 members from among developed andemerging-market nations and active relationships with70 others around the world. 37
  • 37. The Status of Women in 2020By 2020, women will have gained more rights and freedoms—in terms of education,political participation, and work force equality—in most parts of the world, but UN andWorld Health Organization data suggest that the gender gap will not have been closedeven in the developed countries and still will be wide in developing regions. Althoughwomen’s share in the global work force will continue to rise, wage gaps and regionaldisparities will persist.• Although the difference between women’s and men’s earnings narrowed during the past 10 years, women continue to receive less pay than men. For example, a UN study in 2002 showed that in 27 of 39 countries surveyed—both in OECD and developing countries—women’s wages were 20 to 50 percent less than men’s for work in manufacturing.Certain factors will tend to work against gender equality while others will have a positiveimpact.Factors Impeding EqualityIn regions where high youth bulges intersect with historical patterns of patriarchal bias,the added pressure on infrastructure will mean intensified competition for limited publicresources and an increased probability that females will not receive equal treatment.For instance, if schools cannot educate all, boys are likely to be given first priority. Yetviews are changing among the younger generation. In the Middle East, for example,many younger Muslims recognize the importance of educated wives as potentialcontributors to family income.In countries such as China and India, where there is a pervasive “son preference”reinforced by government population control policies, women face increased risk notonly of female infanticide but also of kidnapping and smuggling from surroundingregions for the disproportionately greater number of unattached males. Thus far, thepreference for male children in China has led to an estimated shortfall of 30 millionwomen.Such statistics suggest that the global female trafficking industry, which already earnsan estimated $4 billion every year, is likely to expand, making it the second mostprofitable criminal activity behind global drug trafficking.The feminization of HIV/AIDS is another worrisome trend. Findings from the July 2004Global AIDS conference held in Bangkok reveal that the percentage of HIV-infectedwomen is rising on every continent and in every major region in the world exceptWestern Europe and Australia. Young women comprise 75 percent of those betweenthe ages of 15 to 24 who are infected with HIV globally. (Continued on next page…) 38
  • 38. (continued…) The Status of Women in 2020Factors Contributing to EqualityA broader reform agenda that includes good governance and low unemploymentlevels is essential to raising the status of women in many countries. Internationaldevelopment experts emphasize that while good governance need not fit a Westerndemocratic mold, it must deliver stability through inclusiveness and accountability.Reducing unemployment levels is crucial because countries already unable to provideemployment for male job-seekers are not likely to improve employment opportunities forwomen.The spread of information and communication technologies (ICT) offers greatpromise. According to World Bank analysis, increases in the level of ICT infrastructuretend to improve gender equality in education and employment. ICT also will enablewomen to form social and political networks. For regions suffering political oppression,particularly in the Middle East, these networks could become a 21st century counterpartto the 1980s’ Solidarity Movement against the Communist regime in Poland.Women in developing regions often turn to nongovernmental organizations (NGOs)to provide basic services. NGOs could become even more important to the status ofwomen by 2020 as women in developing countries face increased threats and acquireIT networking capabilities.The current trend toward decentralization and devolution of power in most states willafford women increased opportunities for political participation. Despite onlymodest gains in the number of female officeholders at the national level—womencurrently are heads of state in only eight countries—female participation in local andprovincial politics is steadily rising and will especially benefit rural women removed fromthe political center of a country.Other BenefitsThe stakes for achieving gender parity are high and not just for women. A growing bodyof empirical literature suggests that gender equality in education promotes economicgrowth and reduces child mortality and malnutrition. At the Millennium Summit, UNleaders pledged to achieve gender equity in primary and secondary education by theyear 2005 in every country of the world.• By 2005, the 45 countries that are not on course to meet the UN targets are likely to suffer 1 to 3 percent lower GDP per capita growth as a result. 39
  • 39. Fictional Scenario: Davos WorldThis scenario provides an illustrationof how robust economic growth overthe next 15 years could reshape theglobalization process—giving it amore non-Western face. It is depictedin the form of a hypothetical letterfrom the head of the World EconomicForum to a former US FederalReserve chairman on the eve of theannual Davos meeting in 2020.Under this scenario, the Asian giantsas well as other developing statescontinue to outpace most “Western”economies, and their huge, consumer-driven domestic markets become amajor focus for global business andtechnology. Many boats are lifted, butsome founder. Africa does better thanone might think, while some medium-sized emerging countries aresqueezed. Western powers, includingthe United States, have to contendwith job insecurity despite the manybenefits to be derived from anexpanding global economy. Althoughbenefiting from energy priceincreases, the Middle East lags behindand threatens the future ofglobalization. In addition, growingtensions over Taiwan may be on theverge of triggering an economicmeltdown. At the end of the scenario,we identify some lessons to be drawnfrom our fictional account, includingthe need for more management byleaders lest globalization slip off therails. 40
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  • 46. Rising Powers: The Changing Geopolitical LandscapeThe likely emergence of China and India exercise their growing power andas new major global players—similar to whether they relate cooperatively orthe rise of Germany in the 19th century competitively to other powers in theand the United States in the early 20th international system are keycentury—will transform the geopolitical uncertainties.landscape, with impacts potentially asdramatic as those of the previous two A combination of sustained highcenturies. In the same way that economic growth, expanding militarycommentators refer to the 1900s as the capabilities, active promotion of high“American Century,” the early 21st century technologies, and large populations willmay be seen as the time when some in be at the root of the expected rapid rise inthe developing world, led by China and economic and political power for bothIndia, come into their own. countries.• The population of the region that • Because of the sheer size of China’s served as the locus for most 20th- and India’s populations—projected by century history—Europe and Russia— the US Census Bureau to be 1.4 will decline dramatically in relative billion and almost 1.3 billion terms; almost all population growth respectively by 2020—their standard will occur in developing nations that of living need not approach Western until recently have occupied places on levels for these countries to become the fringes of the global economy (see important economic powers. graphic on page 48).6 • China, for example, is now the third• The “arriviste” powers—China, India, largest producer of manufactured and perhaps others such as Brazil and goods, its share having risen from four Indonesia—could usher in a new set to 12 percent in the past decade. It of international alignments, potentially should easily surpass Japan in a few marking a definitive break with some years, not only in share of of the post-World War II institutions manufacturing but also of the world’s and practices. exports. Competition from “the China price” already powerfully restrains• Only an abrupt reversal of the process manufactures prices worldwide. of globalization or a major upheaval in these countries would prevent their • India currently lags behind China (see rise. Yet how China and India box on page 53) on most economic measures, but most economists6 believe it also will sustain high levels CIA, Long-Term Global Demographic Trends:Reshaping the Geopolitical Landscape, July 2001. of economic growth. 47
  • 47. At the same time, other changes are The growing demand for energy will drivelikely to shape the new landscape. These many of these likely changes on theinclude the possible economic rise of geopolitical landscape. China’s andother states—such as Brazil, South India’s perceived need to secure accessAfrica, Indonesia, and even Russia— to energy supplies will propel thesewhich may reinforce the growing role of countries to become more global ratherChina and India even though by than just regional powers, while Europethemselves these other countries would and Russia’s co-dependency is likely tohave more limited geopolitical impact. be strengthened.Finally, we do not discount the possibilityof a stronger, more united Europe and a Rising Asiamore internationally activist Japan, China’s desire to gain “great power”although Europe, Japan, and Russia will status on the world stage will be reflectedbe hard pressed to deal with aging in its greater economic leverage overpopulations. 48
  • 48. countries in the region and elsewhere as • Faced with a rapidly aging societywell as its steps to strengthen its military. beginning in the 2020s, China may beEast Asian states are adapting to the hard pressed to deal with all theadvent of a more powerful China by issues linked to such seriousforging closer economic and political ties demographic problems. It is unlikelywith Beijing, potentially accommodating to have developed by then the samethemselves to its preferences, particularly coping mechanisms—such ason sensitive issues like Taiwan. sophisticated pension and health-care systems—characteristic of Western• Japan, Taiwan, and various Southeast societies. Asian nations, however, also may try to appeal to each other and the United • If China’s economy takes a downward States to counterbalance China’s turn, regional security would weaken, growing influence. resulting in heightened prospects for political instability, crime, narcoticsChina will continue to strengthen its trafficking, and illegal migration.military through developing and acquiringmodern weapons, including advanced “Economic setbacks and crises offighter aircraft, sophisticated submarines,and increasing numbers of ballistic confidence could slow China’smissiles. China will overtake Russia and emergence as a full-scale greatothers as the second largest defense power…. ”spender after the United States over thenext two decades and will be, by anymeasure, a first-rate military power. The rise of India also will present strategic complications for the region.Economic setbacks and crises of Like China, India will be an economicconfidence could slow China’s magnet for the region, and its rise willemergence as a full-scale great power, have an impact not only in Asia but alsohowever. Beijing’s failure to maintain its to the north—Central Asia, Iran, and othereconomic growth would itself have a countries of the Middle East. India seeksglobal impact. to bolster regional cooperation both for strategic reasons and because of its• Chinese Government failure to satisfy desire to increase its leverage with the popular needs for job creation could West, including in such organizations as trigger political unrest. the World Trade Organization (WTO). 49
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  • 50. As India’s economy grows, governments land, water, and energy supplies—in Southeast Asia—Malaysia, intensifying as it modernizes. ForSingapore, Thailand, and other example, India will face stark choices ascountries—may move closer to India to its population increases and its surfacehelp build a potential geopolitical and ground water become even morecounterweight to China. At the same polluted.time, India will seek to strengthen its tieswith countries in the region without Other Rising States?excluding China. Brazil, Indonesia, Russia, and South Africa also are poised to achieve• Chinese-Indian bilateral trade is economic growth, although they are expected to rise rapidly from its unlikely to exercise the same political current small base of $7.6 billion, clout as China or India. Their growth according to Goldman Sachs and undoubtedly will benefit their neighbors, other experts. but they appear unlikely to become such economic engines that they willJust like China, India may stumble and be able to alter the flow of economicexperience political and economic power within and through theirvolatility with pressure on resources— 51
  • 51. Risks to Chinese Economic GrowthWhether China’s rise occurs smoothly is a key uncertainty. In 2003, the RANDCorporation identified and assessed eight major risks to the continued rapid growth ofChina’s economy over the next decade. Its “Fault Lines in China’s Economic Terrain”highlighted:• Fragility of the financial system and state-owned enterprises• Economic effects of corruption• Water resources and pollution• Possible shrinkage of foreign direct investment• HIV/AIDS and epidemic diseases• Unemployment, poverty, and social unrest• Energy consumption and prices• Taiwan and other potential conflictsRAND’s estimates of the negative growth impact of these adverse developmentsoccurring separately on a one-at-a-time basis range from a low of between 0.3 and0.8 percentage points for the effects of poverty, social unrest, and unemployment to ahigh of between 1.8 and 2.2 percentage points for epidemic disease.• The study assessed the probability that none of these developments would occur before 2015 as low and noted that they would be more likely to occur in clusters rather than individually – financial distress, for example, would also worsen corruption, compound unemployment, poverty, and social unrest, and reduce foreign direct investment.• RAND assessed the probability of all of these adverse developments occurring before 2015 as very low but estimated that should they all occur their cumulative effect would be to reduce Chinese economic growth by between 7.4 and 10.7 percentage points—effectively wiping out growth during that time frame. 52
  • 52. India vs. China: Long-Term ProspectsIndia lags economically behind China, according to most measures such as overall GDP,amount of foreign investment (today a small fraction of China’s), and per capita income. Inrecent years, India’s growth rate has lagged China’s by about 20 percent. Nevertheless,some experts believe that India might overtake China as the fastest growing economy in theworld. India has several factors working for it:• Its working-age population will continue to increase well into the 2020s, whereas, due to the one-child policy, China’s will diminish and age quite rapidly.• India has well-entrenched democratic institutions, making it somewhat less vulnerable to political instability, whereas China faces the continuous challenge of reconciling an increasingly urban and middle-class population with an essentially authoritarian political system.• India possesses working capital markets and world-class firms in some important high- tech sectors, which China has yet to achieve.On the other hand, while India has clearly evolved beyond what the Indians themselvesreferred to as the 2-3 percent “Hindu growth rate,” the legacy of a stifling bureaucracy stillremains. The country is not yet attractive for foreign investment and faces strong politicalchallenges as it continues down the path of economic reform. India is also faced with theburden of having a much larger proportion of its population in desperate poverty. Inaddition, some observers see communal tensions just below the surface, citing the overalldecline of secularism, growth of regional and caste-based political parties, and the 2002“pogrom” against the Muslim minority in Gujarat as evidence of a worsening trend.Several factors could weaken China’s prospects for economic growth, especially the risks topolitical stability and the challenges facing China’s financial sector as it moves toward afuller market orientation. China might find its own path toward an “Asian democracy” thatmay not involve major instability or disruption to its economic growth—but there are a largenumber of unknowns.In many other respects, both China and India still resemble other developing states in theproblems each must overcome, including the large numbers, particularly in rural areas, whohave not enjoyed major benefits from economic growth. Both also face a potentially seriousHIV/AIDS epidemic that could seriously affect economic prospects if not brought undercontrol. According to recent UN data, India has overtaken South Africa as the country withthe largest number of HIV-infected people.The bottom line: India would be hard-pressed to accelerate economic growth rates to levelsabove those reached by China in the past decade. But China’s ability to sustain its currentpace is probably more at risk than is India’s; should China’s growth slow by severalpercentage points, India could emerge as the world’s fastest-growing economy as we headtowards 2020. 53
  • 53. regions—a key element in Beijing and political instability. Indonesia is anNew Delhi’s political and economic amalgam of divergent ethnic and religiousrise. groups. Although an Indonesian national identity has been forged in the fiveExperts acknowledge that Brazil is a decades since independence, thepivotal state with a vibrant democracy, a government is still beset by stubborndiversified economy and an secessionist movements.entrepreneurial population, a largenational patrimony, and solid economic Russia’s energy resources will give ainstitutions. Brazil’s success or failure in boost to economic growth, but Russiabalancing pro-growth economic measures faces a severe demographic challengewith an ambitious social agenda that resulting from low birth rates, poorreduces poverty and income inequality medical care, and a potentially explosivewill have a profound impact on region- AIDS situation. US Census Bureauwide economic performance and projections show the working-agegovernance during the next 15 years. population likely to shrink dramatically byLuring foreign direct investment and 2020. Russia’s present trajectory awayadvancing regional stability and equitable from pluralism toward bureaucraticintegration—including trade and authoritarianism also decreases theeconomic infrastructure—probably will chances it will be able to attract foreignremain axioms of Brazilian foreign policy. investment outside the energy sector,Brazil is a natural partner both for the limiting prospects for diversifying itsUnited States and Europe and for rising economy. The problems along itspowers China and India and has the southern borders—including Islamicpotential to enhance its leverage as a net extremism, terrorism, weak states withexporter of oil. poor governance, and conflict—are likely to get worse over the next 15 years.Experts assess that over the course of Inside Russia, the autonomous republicsthe next decade and a half Indonesia in North Caucasus risk failure and willmay revert to high growth of 6 to 7 remain a source of endemic tension andpercent, which along with its expected conflict. While these social and politicalincrease in its relatively large population factors limit the extent to which Russiafrom 226 to around 250 million would can be a major global player, in themake it one of the largest developing complex world of 2020 Russia could beeconomies. Such high growth would an important, if troubled, partner both forpresume an improved investment the established powers, such as theenvironment, including intellectual United States and Europe, and the risingproperty rights protection and openness powers of China and India. The potentialto foreign investment. With slower growth also exists for Russia to enhance itsits economy would be unable to absorb leverage with others as a result of itsthe unemployed or under-employed labor position as a major oil and gas exporter.force, thus heightening the risk of greater 54
  • 54. Asia: The Cockpit for Global Change?According to the regional experts we consulted, Asia will exemplify most of the trendsthat we see as shaping the world over the next 15 years. Northeast and Southeast Asiawill progress along divergent paths—the countries of the North will become wealthierand more powerful, while at least some states in the South may lag economically andwill continue to face deep ethnic and religious cleavages. As Northeast Asia acts as apolitical and economic center of gravity for the countries of the South, parts ofSoutheast Asia will be a source of transnational threats—terrorism and organizedcrime—to the countries of the North. The North/South divisions are likely to be reflectedin a cultural split between non-Muslim Northeast Asia, which will adapt to the continuingspread of globalization, and Southeast Asia, where Islamic fundamentalism mayincreasingly make inroads in such states as Indonesia, Malaysia, and parts of ThePhilippines. The diversion of investment towards China and India also could spurSoutheast Asia to implement plans for a single economic community and investmentarea by 2020.The experts also felt that demographic factors will play a key role in shaping regionaldevelopments. China and other countries in Northeast Asia, including South Korea, willexperience a slowing of population growth and a “graying” of their peoples over the next15 years. China also will have to face the consequences of a gender imbalance causedby its one-child policy. In Southeast Asian countries such as The Philippines andIndonesia, rising populations will challenge the capacity of governments to provide basicservices. Population and poverty pressures will spur migration within the region and toNortheast Asia. High population concentrations and increasing ease of travel willfacilitate the spread of infectious diseases, risking the outbreak of pandemics.The regional experts felt that the possibility of major inter-state conflict remains higher inAsia than in other regions. In their view, the Korean Peninsula and Taiwan Strait crisesare likely to come to a head by 2020, risking conflict with global repercussions. At thesame time, violence within Southeast Asian states—in the form of separatistinsurgencies and terrorism—could intensify. China also could face sustained armedunrest from separatist movements along its western borders.Finally, the roles of and interaction between the region’s major powers—China, Japan,and the US—will undergo significant change by 2020. The United States and Chinahave strong incentives to avoid confrontation, but rising nationalism in China and fearsin the US of China as an emerging strategic competitor could fuel an increasinglyantagonistic relationship. Japan’s relationship with the US and China will be shaped byChina’s rise and the nature of any settlement on the Korean Peninsula and overTaiwan. 55
  • 55. “Russia’s energy resources will Taiwan and the challenge of integrating give a boost to economic growth, rising China and India without major disruption. If anything, growing Chinese but Russia faces a severe economic power is likely to spur demographic challenge…[with increased activism by Japan on the world its] working-age population likely stage. to shrink dramatically.” Opinion polls indicate growing publicSouth Africa will continue to be support for Japan becoming a morechallenged by AIDS and widespread “normal” country with a proactive foreigncrime and poverty, but prospects for its policy. Experts see various trajectorieseconomy—the largest in the region—look that Japan could follow depending onpromising. According to some forecasts, such factors as the extent of China’sSouth Africa’s economy is projected to growing strength, a resurgence or lack ofgrow over the next decade in the 4- to continued vitality in Japan’s economy, the5-percent range if reformist policies are level of US influence in the region andimplemented. Experts disagree over how developments in Korea and Taiwanwhether South Africa can be an engine play out. At some point, for example,for more than southern Africa or will Japan may have to choose betweeninstead forge closer relationships with “balancing” against or “bandwagoning”middling or up-and-coming powers on with China.other continents. South African expertsadept at scenario-building and gaming “…Europe’s strength may be insee the country’s future as lying with providing… a model of global andpartnerships formed outside the region. regional governance to the risingThe “Aging” Powers powers…”Japan’s economic interests in Asia haveshifted from Southeast Asia toward By most measures—market size, singleNortheast Asia—especially China and the currency, highly skilled work force, stableChina-Japan-Korea triangle—over the democratic governments, unified tradepast two decades and experts believe the bloc, and GDP—an enlarged Europe willaging of Japan’s work force will reinforce have the ability to increase its weight ondependence on outbound investment and the international scene. Its crossroadsgreater economic integration with location and the growing diversity of itsNortheast Asia, especially China7. At the population—particularly in pulling in newsame time, Japanese concerns regarding members—provides it with a uniqueregional stability are likely to grow owing ability to forge strong bonds both to theto the ongoing crisis over North Korea, south with the Muslim world and Africacontinuing tensions between China and and to the east with Russia and Eurasia.7 Asia’s Shifting Strategic Landscape, Foreign PolicyResearch Institute, 26 November 2003. 56
  • 56. The extent to which Europe enhances its historically have had difficulties inclout on the world stage depends on its coordinating and rationalizing defenseability to achieve greater political spending in such a way as to boostcohesion. In the short term, taking in ten capabilities despite progress on a greaternew east European members probably EU security and defense role. Whetherwill be a “drag” on the deepening of the EU will develop an army is an openEuropean Union (EU) institutions question, in part because its creationnecessary for the development of a could duplicate or displace NATO forces.cohesive and shared “strategic vision” forthe EU’s foreign and security policy. While its military forces have little capacity for power projection, Europe’s• Unlike the expansion when Ireland, strength may be in providing, through its Spain, Portugal and Greece joined the commitment to multilateralism, a model of Common Market in the 1970s and global and regional governance to the early 1980s, Brussels has a fraction of rising powers, particularly if they are the structural funds available for searching for a “Western” alternative to quickly bringing up the Central strong reliance on the United States. For Europeans to the economic levels of example, an EU-China alliance, though the rest of the EU. still unlikely, is no longer unthinkable.• Possible Turkish membership Aging populations and shrinking work presents both challenges—because of forces in most countries will have an Turkey’s size and religious and important impact on the continent, cultural differences—as well as creating a serious but not insurmountable opportunities, provided that mutual economic and political challenge. acceptance and agreement can be Europe’s total fertility rate is about 1.4— achieved. In working through the well below the 2.1 replacement level. problems, a path might be found that Over the next 15 years, West European can help Europe to accommodate and economies will need to find several integrate its growing Muslim million workers to fill positions vacated by population. retiring workers. Either European countries adapt their work forces, reformDefense spending by individual European their social welfare, education, and taxcountries, including the UK, France, and systems, and accommodate growingGermany is likely to fall further behind immigrant populations (chiefly fromChina and other countries over the next Muslim countries) or they face a period of15 years. Collectively these countries will protracted economic stasis that couldoutspend all others except the US and threaten the huge successes made inpossibly China8. EU member states creating a more United Europe.8 Strategic Trends, Joint Doctrine and ConceptsCentre, March 2003. 57
  • 57. Global Aging and MigrationAccording to US Census Bureau projections, about half of the world’s population lives incountries or territories whose fertility rates are not sufficient to replace their currentpopulations. This includes not only Europe, Russia, and Japan, where the problem isparticularly severe, but also most parts of developed regions such as Australia, NewZealand, North America, and East Asian countries like Singapore, Hong Kong, Taiwan,and South Korea. Certain countries in the developing world, including Arab and Muslimstates such as Turkey, Algeria, Tunisia, and Lebanon, also are dropping below the levelof 2.1 children per woman necessary to maintain long-term population stability.9China is a special case where the transition to an aging population—nearly 400 millionChinese will be over 65 by 2020—is particularly abrupt and the emergence of a seriousgender imbalance could have increasing political, social, and even internationalrepercussions. An unfunded nationwide pension arrangement means many Chinesemay have to continue to work into old age.Migration has the potential to help solve the problem of a declining work force in Europeand, to a lesser degree, Russia and Japan and probably will become a more importantfeature of the world of 2020, even if many of the migrants do not have legal status.Recipient countries face the challenge of integrating new immigrants so as to minimizepotential social conflict.• Remittances from migrant workers are increasingly important to developing economies. Some economists believe remittances are greater than foreign direct investment in most poor countries and in some cases are more valuable than exports.However, today one-half of Nigerian-born medical doctors and PhDs reside in theUnited States. Most experts do not expect the current, pronounced trend of “braindrain” from the Middle East and Africa to diminish. Indeed, it could increase with theexpected growth of employment opportunities, particularly in Europe.9 Nicholas Eberstadt, “Four Surprises in Global Demography,” Foreign Policy Research Institute’s Watch on theWest, Vol 5, Number 5, July 2004. 58
  • 58. Growing Demands for EnergyGrowing demands for energy— • Renewable energy sources such asespecially by the rising powers—through hydrogen, solar, and wind energy2020 will have substantial impacts on probably will account for only about 8geopolitical relations. The single most percent of the energy supply in 2020.important factor affecting the demand While Russia, China, and India allfor energy will be global economic plan expansions of their nucleargrowth, particularly that of China and power sector, nuclear powerIndia. probably will decline globally in absolute terms in the next decade.• Despite the trend toward more efficient energy use, total energy The International Energy Agency consumed probably will rise by about assesses that with substantial 50 percent in the next two decades investment in new capacity, overall compared to a 34 percent expansion energy supplies will be sufficient to meet from 1980–2000, with an increasing growing global demand. Continued share provided by petroleum. 59
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  • 60. Could Europe Become A Superpower?According to the regional experts we consulted, Europe’s future international role dependsgreatly on whether it undertakes major structural economic and social reforms to deal with itsaging work-force problem. The demographic picture will require a concerted, multidimensionalapproach including:• More legal immigration and better integration of workers likely to be coming mainly from North Africa and the Middle East. Even if more guest workers are not allowed in, Western Europe will have to integrate a growing Muslim population. Barring increased legal entry may only lead to more illegal migrants who will be harder to integrate, posing a long- term problem. It is possible to imagine European nations successfully adapting their work forces and social welfare systems to these new realities; it is harder to see a country— Germany, for example—successfully assimilating millions of new Muslim migrant workers in a short period of time.• Increased flexibility in the workplace, such as encouraging young women to take a few years off to start families in return for guarantees of reentry. Encouraging the “younger elderly” (50-65 year olds) to work longer or return to the work force also would help ease labor shortages.The experts felt that the current welfare state is unsustainable and the lack of any economicrevitalization could lead to the splintering or, at worst, disintegration of the European Union,undermining its ambitions to play a heavyweight international role.The experts believe that the EU’s economic growth rate is dragged down by Germany and itsrestrictive labor laws. Structural reforms there—and in France and Italy to lesser extents—remain key to whether the EU as a whole can break out of its slow-growth pattern. A total breakfrom the post-World War II welfare state model may not be necessary, as shown in Sweden’ssuccessful example of providing more flexibility for businesses while conserving many workerrights. Experts are dubious that the present political leadership is prepared to make even thispartial break, believing a looming budgetary crisis in the next five years would be the more likelytrigger for reform.If no changes were implemented Europe could experience a further overall slowdown, andindividual countries might go their own way, particularly on foreign policy, even if they remainednominal members. In such a scenario, enlargement is likely to stop with current members,making accession unlikely for Turkey and the Balkan countries, not to mention long-termpossibilities such as Russia or Ukraine. Doing just enough to keep growth rates at one or twopercent may result in some expansion, but Europe probably would not be able to play a majorinternational role commensurate with its size.In addition to the need for increased economic growth and social and welfare reform, manyexperts believe the EU has to continue streamlining the complicated decision-making processthat hinders collective action. A federal Europe—unlikely in the 2020 timeframe—is notnecessary to enable it to play a weightier international role so long as it can begin to mobilizeresources and fuse divergent views into collective policy goals. Experts believe an economic“leap forward”—stirring renewed confidence and enthusiasm in the European project—couldtrigger such enhanced international action. 61
  • 61. limited access of the international oil The Geopolitics of Gas. Both oil andcompanies to major fields could restrain gas suppliers will have greater leveragethis investment, however, and many of than today, but the relationship betweenthe areas—the Caspian Sea, Venezuela, gas suppliers and consumers is likely toWest Africa and South China Sea—that be particularly strong because of theare being counted on to provide restrictions on delivery mechanisms.increased output involve substantial Gas, unlike oil, is not yet a fungiblepolitical or economic risk. Traditional source of energy, and thesuppliers in the Middle East are also interdependency of pipeline delivery—increasingly unstable. Thus sharper producers must be connected todemand-driven competition for resources, consumers, and typically neither groupperhaps accompanied by a major has many alternatives—reinforcesdisruption of oil supplies, is among the regional alliances.key uncertainties. • More than 95 percent of gas producedChina and India, which lack adequate and three quarters of gas traded isdomestic energy resources, will have to distributed via pipelines directly fromensure continued access to outside supplier to consumer, and gas-to-suppliers; thus, the need for energy will liquids technology is unlikely tobe a major factor in shaping their foreign change these ratios substantially byand defense policies, including expanding 2020.naval power. • Europe will have access to supplies in• Experts believe China will need to Russia and North Africa while China boost its energy consumption by will be able to draw from eastern about 150 percent and India will need Russia, Indonesia, and potentially to nearly double its consumption by huge deposits in Australia. The 2020 to maintain a steady rate of United States will look almost economic growth. exclusively to Canada and other western hemisphere suppliers.• Beijing’s growing energy requirements are likely to prompt China to increase its activist role in the world—in the investing overseas is more secure Middle East, Africa, Latin America, than imports purchased on the and Eurasia. In trying to maximize international market. Chinese firms and diversify its energy supplies, are being directed to invest in projects China worries about being vulnerable in the Caspian region, Russia, the to pressure from the United States Middle East, and South America in which Chinese officials see as having order to secure more reliable access. an aggressive energy policy that can be used against Beijing. Europe’s energy needs are unlikely to grow to the same extent as those of the• For more than ten years Chinese developing world, in part because of officials have openly asserted that Europe’s expected lower economic production from Chinese firms growth and more efficient use of energy. 62
  • 62. Europe’s increasing preference for US Unipolarity—How Long Can Itnatural gas, combined with depleting Last?reserves in the North Sea, will give an A world with a single superpower isadded boost to political efforts already unique in modern times. Despite the riseunder way to strengthen ties with Russia in anti-Americanism, most major powersand North Africa, as gas requires a higher today believe countermeasures such aslevel of political commitment by both balancing are not likely to work in asides in designing and constructing the situation in which the US controls sonecessary infrastructure. According to a many of the levers of power. Moreover,study by the European Commission, the US policies are not perceived asUnion’s share of energy from foreign sufficiently threatening to warrant such asources will rise from about half in 2000 two-thirds by 2020. Gas use willincrease most rapidly due to • Growing numbers of people aroundenvironmental concerns and the phasing the world, especially in the Middleout of much of the EU’s nuclear energy East and the broader Muslim world,capacity. believe the US is bent on regional domination—or direct political and “…many of the areas… being economic domination of other states counted on to provide increased and their resources. In the future, growing distrust could prompt [energy] output involve substantial governments to take a more hostile political or economic risk.… Thus approach, including resistance to sharper demand-driven support for US interests in competition… perhaps accompanied multinational forums and development by a major disruption of oil supplies, of asymmetric military capabilities as a is among the key uncertainties.” hedge against the US.Deliveries from the Yamal-Europe “There are few policy-relevantpipeline and the Blue Stream pipeline will theories to indicate how states arehelp Russia increase its gas sales to the likely to deal with a situation inEU and Turkey by more than 40 percent which the US continues to be theover 2000 levels in the first decade of the single most powerful actor21st century; as a result, Russia’s share oftotal European demand will rise from 27 economically, militarily, andpercent in 2000 to 31 percent in 2010. technologically.”Russia, moreover, as the largest energysupplier outside of OPEC, will be well Most countries are likely to experimentpositioned to marshal its oil and gas with a variety of different tactics fromreserves to support domestic and foreign various degrees of resistance topolicy objectives. Algeria has the world’s engagement in an effort to influence howeighth largest gas reserves and also is US power is exercised. We expect thatseeking to increase its exports to Europe countries will pursue strategies designedby 50 percent by the end of the decade. to exclude or isolate the US—perhaps 63
  • 63. temporarily—in order to force or cajolethe US into playing by others’ rules.Many countries increasingly believe thatthe surest way to gain leverage overWashington is by threatening to withholdcooperation. In other forms of bargaining,foreign governments will try to find waysto “bandwagon” or connect their policyagendas to those of the US—for exampleon the war on terrorism—and therebyfend off US opposition to other policies.Fictional Scenario: PaxAmericanaThe scenario portrayed below looks athow US predominance may surviveradical changes to the global politicallandscape, with Washingtonremaining the central pivot forinternational politics. It is depicted asthe diary entry by a fictitious UNSecretary-General in 2020. Underthis scenario, key alliances andrelationships with Europe and Asiaundergo change. US-Europeancooperation is renewed, including onthe Middle East. There are newsecurity arrangements in Asia, but theUnited States still does the heavylifting. The scenario also suggeststhat Washington has to struggle toassert leadership in an increasinglydiverse, complex, and fast-pacedworld. At the end of the scenario, weidentify lessons learned from how thescenario played out. 64
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  • 72. New Challenges to GovernanceThe nation-state will continue to be the slipping back toward authoritarianism,dominant unit of the global order, but and global economic growth probably willeconomic globalization and the dispersion not on its own reverse such a trend. Theof technologies, especially information development of more diversifiedtechnologies, will place enormous strains economies in these countries—by noon governments. Regimes that were able means inevitable—would be crucial into manage the challenges of the 1990s fostering the growth of a middle class,could be overwhelmed by those of 2020. which in turn would spur democratization.Contradictory forces will be at work:authoritarian regimes will face new • Beset already by severe economicpressures to democratize, but fragile new inequalities, aging Central Asian rulersdemocracies may lack the adaptive must contend with unruly and largecapacity to survive and develop. youth populations lacking broad economic opportunities. Central• With migration on the increase in Asian governments are likely to several places around the world— suppress dissent and revert to from North Africa and the Middle East authoritarianism to maintain order, into Europe, Latin America and the risking growing insurgencies. Caribbean into the United States, and increasingly from Southeast Asia into “…backsliding by many countries the northern regions—more countries that were considered part of the will be multi-ethnic and multi-religious and will face the challenge of ‘third wave’ of democratization is integrating migrants into their societies a distinct possibility.” while respecting their ethnic and religious identities. Chinese leaders will face a dilemma over how much to accommodate pluralisticHalting Progress on Democratization pressure and relax political controls orGlobal economic growth has the potential risk a popular backlash if they do spur democratization, but backsliding Beijing also has to weigh in the balanceby many countries that were considered its ambition to be a major global player,part of the “third wave” of democratization which would be enhanced if its rulersis a distinct possibility. In particular, by moved towards political reform.2020 democratization may be partiallyreversed among the states of the former China may pursue an “Asian way” ofSoviet Union and in Southeast Asia, democracy that might involve elections atsome of which never really embraced the local level and a consultativedemocracy. Russia and most of the mechanism on the national level, perhapsCentral Asian regimes appear to be 73
  • 73. Eurasian Countries: Going Their Separate Ways?The regional experts who attended our conference felt that Russia’s political development sincethe fall of Communism has been complicated by the continuing search for a post-Soviet nationalidentity. Putin has increasingly appealed to Russian nationalism—and, occasionally,xenophobia—to define Russian identity. His successors may well define Russian identity byhighlighting Russia’s imperial past and its domination over its neighbors even as they rejectcommunist ideology.In the view of the experts, Central Asian states are weak, with considerable potential forreligious and ethnic conflict over the next 15 years. Religious and ethnic movements couldhave a destabilizing impact across the region. Eurasia is likely to become more differentiateddespite the fact that demographic counterforces—such as a dearth of manpower in Russia andwestern Eurasia and an oversupply in Central Asia—could help pull the region together.Moreover, Russia and the Central Asians are likely to cooperate in developing transportationcorridors for energy supplies.The participants assessed that among the resource-rich countries, Russia has the bestprospects for expanding its economy beyond resource extraction and becoming more integratedinto the world economy. To diversify its economy, Russia would need to undertake structuralchanges and institute the rule of law, which could in turn encourage foreign direct investmentoutside of the energy sector. Knowing that Europe probably would want to forge a “specialrelationship” with a Russia that is stronger economically, Moscow probably would be moretolerant of former Soviet states moving closer to Europe. If Russia fails to diversify its economy,it could well experience the petro-state phenomenon of unbalanced economic development,huge income inequality, capital flight, and increased social problems.Regional experts were less confident about the potential for significant economic diversificationin the other resource-rich countries in Central Asia and the South Caucasus over the next 15years—in particular, Kazakhstan, Turkmenistan, and Azerbaijan. For countries with morelimited natural resources, such as Ukraine, Georgia, Kyrgyztan, Tajikistan and Uzbekistan, thechallenge will be to develop effective project and service industries, requiring better governance.Central Asian countries—Kazakhstan, Krgyzstan, Tajikistan, Turkmenistan, and Uzbekistan—face the stiff challenge of keeping the social peace in a context of high population growth, arelatively young population, limited economic prospects, and growing radical Islamic influence.Allowing more emigration could help alleviate these pressures in Central Asian countries.Russia would benefit from migration as a means of compensating for its loss of approximatelyone million people a year through 2020. Russia, however, has little experience in integratingmigrants from other cultures; Russian nationalism is on the increase as a result of growingethnic unrest domestically, and our experts believe any efforts to expand immigration policieswould be exploited by nationalist politicians.Ironically, the experts foresaw more unity if economic conditions worsen globally and Eurasia isisolated. In that case, a stagnant Russia would be looked to by the others to maintain orderalong the southern rim as some Central Asian countries—Turkmenistan, Tajikistan, andKyrgyzstan—faced potential collapse. 74
  • 74. with the Communist Party retaining the growth of civil society institutions,control over the central government. although radicals may use the ballot box to gain power.• Younger Chinese leaders who are already exerting influence as mayors • An extended period of high oil prices and regional officials have been would allow regimes to put off trained in Western-style universities economic and fiscal reform. and have a good understanding of international standards of governance. High-Tech Pressures on Governance. Today individual PC users have more• Most of the experts at our regional capacity at their fingertips than NASA had conference, however, believe present with the computers used in its first moon and future leaders are agnostic on the launches. The trend toward even more issue of democracy and are more capacity, speed, affordability, and mobility interested in developing what they will have enormous political implications: perceive to be the most effective myriad individuals and small groups— model of governance. many of whom had not been previously so empowered—will not only connect withDemocratic progress could gain ground in one another but will plan, mobilize, andkey Middle Eastern countries, which thus accomplish tasks with potentially morefar have been excluded from the process satisfying and efficient results than theirby repressive regimes. Success in governments can deliver. This almostestablishing a working democracy in Iraq certainly will affect individuals’and Afghanistan—and democratic relationships with and views of theirconsolidation in Indonesia—would set an governments and will put pressure onexample for other Muslim and Arab some governments for morestates, creating pressures for change. responsiveness.However, a 2001 Freedom House study • China is experiencing among theshowed a dramatic and expanding gap in fastest rates of increase of Internetthe levels of freedom and democracy and mobile phone users in the world,between Islamic countries and the rest of according to the Internationalthe world. The lack of economic growth Telecommunications Union, and is thein the Middle East outside the energy leading market for broadbandsector is one of the primary underlying communication.factors for the slow pace. Many regionalexperts are not hopeful that the • Reports of growing investment bygenerational turnover in several of the many Middle Eastern governments inregimes will by itself spur democratic developing high-speed informationreform. infrastructures, although they are not yet widely available to the population• The extent to which radical Islam nor well-connected to the larger world, grows and how regimes respond to its show obvious potential for the spread pressures will also have long-term of democratic—and undemocratic— repercussions for democratization and ideas. 75
  • 75. Climate Change and Its Implications Through 2020Policies regarding climate change are likely to feature significantly in multilateralrelations, and the United States, in particular, is likely to face significant bilateralpressure to change its domestic environmental policies and to be a leader in globalenvironmental efforts. There is a strong consensus in the scientific community that thegreenhouse effect is real and that average surface temperatures have risen over thelast century, but uncertainty exists about causation and possible remedies. Experts in aNIC-sponsored conference judged that concerns about greenhouse gases, of whichChina and India are large producers, will increase steadily through 2020. There arelikely to be numerous weather-related events that, correctly or not, will be linked toglobal warming. Any of these events could lead to widespread calls for the UnitedStates, as the largest producer of greenhouse gases, to take dramatic steps to reduceits consumption of fossil fuels.Policymakers will face a dilemma: an environmental regime based solely on economicincentives will probably not produce needed technological advances because firms willbe hesitant to invest in research when there is great uncertainty about potential profits.On the other hand, a regime based on government regulation will tend to be costly andinflexible. The numerous obstacles to multilateral action include resistance from OPECcountries that depend on fossil fuel revenues, the developing world’s view that climatechange is a problem created by the industrial world and one they cannot address giventheir economic constraints, and the need for significant technological innovation tomaximize energy efficiency.Among reasons for optimism, participants noted that the world is ready and eager forUS leadership and that new multilateral institutions are not needed to address thisissue. Indeed, crafting a policy to limit carbon emissions would be simplified by the factthat three political entities—the United States, the European Union, and China—account for over half of all CO2 emitted into the atmosphere. An agreement thatincluded these three plus the Russian Federation, Japan, and India would cover two-thirds of all carbon emissions. 76
  • 76. • Some states will seek to control the aggravating social divisions along Internet and its contents, but they will economic and ethnic lines. In parts of face increasing challenges as new Latin America particularly, the failure of networks offer multiple means of elites to adapt to the evolving demands of communicating. free markets and democracy probably will fuel a revival in populism and driveGrowing connectivity also will be indigenous movements, which so faraccompanied by the proliferation of have sought change through democratictransnational virtual communities of means, to consider more drastic meansinterest, a trend which may complicate for seeking what they consider their “fairthe ability of state and global institutions share” of political power and generate internal consensus andenforce decisions and could even • However, as with religion, populismchallenge their authority and legitimacy. will not necessarily be inimical toGroups based on common religious, political development and can serve tocultural, ethnic or other affiliations may be broaden participation in the politicaltorn between their national loyalties and process. Few experts fear a generalother identities. The potential is backsliding to the rule of militaryconsiderable for such groups to drive juntas in Latin America.national and even global politicaldecisionmaking on a wide range of issues The Latin American countries that arenormally the purview of governments. adapting to challenges most effectively are building sturdier and more capableThe Internet in particular will spur the democratic institutions to implement morecreation of global movements, which may inclusive and responsive policies andemerge even more as a robust force in enhance citizen and investor affairs. For example, A sense of economic progress and hopetechnology-enabled diaspora for its continuance appears essential tocommunications in native languages the long-term credibility of democraticcould lead to the preservation of systems.language and culture in the face ofwidespread emigration and cultural Rising nationalism and a trend towardchange as well as the generation of populism also will present a challenge topolitical and economic power. governments in Asia. Many, such as Laos, Cambodia, and Burma, are unablePopulist themes are likely to emerge as to deliver on expanding popular demandsa potent political and social force, and risk becoming state failures.especially as globalization risks 77
  • 77. Latin America in 2020: Will Globalization Cause the Region to Split?The experts we consulted in Latin America contended that global changes over the next15 years could deepen divisions and serve to split Latin America apart in economic,investment, and trade policy terms. As the Southern Cone, particularly Brazil and Chile,reach out to new partners in Asia and Europe, Central America and Mexico, along withAndean countries, could lag behind and remain dependent on the US and Canada astheir preferred trade partners and aid providers.For Latin Americans, government ineffectiveness, in part, prevented many countriesfrom realizing the full measure of economic and social benefits from greater integrationinto the global economy in the past decade. Instead, the gap between rich and thepoor, the represented and the excluded, has grown. Over the next 15 years, the effectsof continued economic growth and global integration are likely to be uneven andfragmentary. Indeed, regional experts foresee an increasing risk of the rise ofcharismatic, self-styled populist leaders, historically common in the region, who wouldplay on popular concerns over inequities between “haves” and “have-nots” in theweakest states in Central America and Andean countries, along with parts of Mexico. Inthe most profoundly weak of these governments, particularly where the criminalizationof the society, and even the state, is most apparent, the leaders could have anautocratic bent and be more stridently anti-American.The experts made the following observations on regional prospects in other areas:• Identity politics. Increasing portions of the population are identifying themselves as indigenous peoples and will demand not only a voice but, potentially, a new social contract. Many reject globalization as it has played out in the region, viewing it as an homogenizing force that undermines their unique cultures and as a US-imposed, neo-liberal economic model whose inequitably distributed fruits are rooted in the exploitation of labor and the environment.• Information technology. The universalization of the Internet, both as a mass media and means of inter-personal communication, will help educate, connect, mobilize, and empower those traditionally excluded. 78
  • 78. • Experts note that a new generation of • For example, Christianity, Buddhism, leaders is emerging in Africa from the and other religions and practices are private sector; these leaders are much spreading in such countries as China more comfortable with democracy as Marxism declines, and the than their predecessors and might proportion of evangelical converts in provide a strong internal dynamic for traditionally heavily Catholic Latin democracy in the future. America is rising.Identity Politics • By 2020, China and Nigeria will havePart of the pressure on governance will some of the largest Christiancome from new forms of identity politics communities in the world, a shift thatcentered on religious convictions and will reshape the traditionally Western-ethnic affiliation. Over the next 15 years, based Christian institutions, givingreligious identity is likely to become an them more of an African or Asian or,increasingly important factor in how more broadly, a developing worldpeople define themselves. The trend face.toward identity politics is linked toincreased mobility, growing diversity of • Western Europe stands apart fromhostile groups within states, and the this growing global “religiosity” exceptdiffusion of modern communications for the migrant communities fromtechnologies. Africa and the Middle East. Many of the churches’ traditional functions—• The primacy of ethnic and religious education, social services, etc.—are identities will provide followers with a now performed by the state. A more ready-made community that serves as pervasive, insistent secularism, a “social safety net” in times of need— however, might not foster the cultural particularly important to migrants. acceptance of new Muslim immigrants Such communities also provide who view as discriminatory the ban in networks that can lead to job some West European countries opportunities. against displays of religious adherence. “Over the next 15 years, religious Many religious adherents—whether identity is likely to become an Hindu nationalists, Christian evangelicals increasingly important factor in in Latin America, Jewish fundamentalists how people define themselves.” in Israel, or Muslim radicals—are becoming “activists.” They have aWhile we do not have comprehensive worldview that advocates change ofdata on the number of people who have society, a tendency toward making sharpjoined a religious faith or converted from Manichaean distinctions between goodone faith to another in recent years, and evil, and a religious belief system thattrends seem to point toward growing connects local conflicts to a largernumbers of converts and a deepening struggle.religious commitment by many religiousadherents. 79
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  • 80. Such religious-based movements have Eastern and West African countriesbeen common in times of social and until at least 2005-2010, and thepolitical turmoil in the past and have effects will linger long after.oftentimes been a force for positivechange. For example, scholars see the • In the Middle East, radical Islam’sgrowth of evangelism in Latin America as increasing hold reflects the politicalproviding the uprooted, racially and economic alienation of manydisadvantaged and often poorest groups, young Muslims from theirincluding women, “with a social network unresponsive and unrepresentativethat would otherwise be lacking… governments and related failure ofproviding members with skills they need many predominantly Muslim states toto survive in a rapidly developing reap significant economic gains fromsociety...(and helping) to promote the globalization.development of civil society in theregion.”10 The spread of radical Islam will have a significant global impact leading to 2020,At the same time, the desire by activist rallying disparate ethnic and nationalgroups to change society often leads to groups and perhaps even creating anmore social and political turmoil, some of authority that transcends nationalit violent. In particular, there are likely to boundaries. Part of the appeal of radicalbe frictions in mixed communities as the Islam involves its call for a return byactivists attempt to gain converts among Muslims to earlier roots when Islamicother religious groups or older civilization was at the forefront of globalestablished religious institutions. In change. The collective feelings ofkeeping with the intense religious alienation and estrangement whichconvictions of many of these movements, radical Islam draws upon are unlikely toactivists define their identities in dissipate until the Muslim world againopposition to “outsiders,” which can foster appears to be more fully integrated intostrife. the world economy.Radical Islam. Most of the regions that “Radical Islam will have awill experience gains in religious“activists” also have youth bulges, which significant global impact…experts have correlated with high rallying disparate ethnic andnumbers of radical adherents, including national groups and perhaps evenMuslim extremists.11 creating an authority that• Youth bulges are expected to be transcends national boundaries.” especially acute in most Middle Radical Islam will continue to appeal to many Muslim migrants who are attracted10 to the more prosperous West for Philip Jenkins, consultations with the NationalIntelligence Council, August 4, 2004. employment opportunities but do not feel11 We define Muslim extremists as a subset of Islamic at home in what they perceive as an alienactivists. They are committed to restructuring political culture.society in accordance with their vision of Islamic lawand are willing to use violence. 81
  • 81. Studies show that Muslim immigrants are Southeast Asia, where the historicbeing integrated as West European Christian-Muslim faultlines cut acrosscountries become more inclusive, but several countries, including West Africa,many second- and third-generation The Philippines, and Indonesia.immigrants are drawn to radical Islam asthey encounter obstacles to full • Schisms within religions, howeverintegration and barriers to what they historic and longlasting, also couldconsider to be normal religious practices. lead to conflict in this era of increased religious identity. A Shia-dominatedDifferences over religion and ethnicity Iraq is likely to encourage greateralso will contribute to future conflict, and, activism by Shia minorities in otherif unchecked, will be a cause of regional Middle Eastern nations, such as Saudistrife. Regions where frictions risk Arabia and Pakistan.developing into wider civil conflict include 82
  • 82. Fictional Scenario: A New ensue both within the Muslim worldCaliphate and outside between Muslims and the United States, Europe, Russia and China. While the Caliph’s success inThe fictional scenario portrayed below mobilizing support varies, places farprovides an example of how a globalmovement fueled by radical religious outside the Muslim core in the Middle East—in Africa and Asia—areidentity could emerge. Under this convulsed as a result of his appeals.scenario, a new Caliphate is proclaimedand manages to advance a powerful The scenario ends before the Caliph is able to establish both spiritual andcounter ideology that has widespreadappeal. It is depicted in the form of a temporal authority over a territory—hypothetical letter from a fictional which historically has been the case for previous Caliphates. At the end of thegrandson of Bin Ladin to a familyrelative in 2020. He recounts the scenario, we identify lessons to bestruggles of the Caliph in trying to drawn.wrest control from traditional regimesand the conflict and confusion which 83
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  • 92. Pervasive InsecurityWe foresee a more pervasive sense of Muslims caught up in national orinsecurity, which may be as much based regional separatist struggles, suchon psychological perceptions as as Palestine, Chechnya, Iraq,physical threats, by 2020. The Kashmir, Mindanao, or southernpsychological aspects, which we have Thailand and has emerged inaddressed earlier in this paper, include response to government repression,concerns over job security as well as corruption, and ineffectiveness.fears revolving around migration amongboth host populations and migrants. • A radical takeover in a Muslim country in the Middle East could spurTerrorism and internal conflicts could the spread of terrorism in the regioninterrupt the process of globalization by and give confidence to others that asignificantly increasing the security new Caliphate is not just a dream.costs associated with internationalcommerce, encouraging restrictive • Informal networks of charitableborder control policies, and adversely foundations, madrasas, hawalas,12affecting trade patterns and financial and other mechanisms will continuemarkets. Although far less likely than to proliferate and be exploited byinternal conflicts, conflict among great radical elements.powers would create risks to worldsecurity. The potential for the • Alienation among unemployedproliferation of weapons of mass youths will swell the ranks of thosedestruction (WMD) will add to the vulnerable to terrorist recruitment.pervasive sense of insecurity.Transmuting International Terrorism “Our greatest concern is thatThe key factors that spawned [terrorist groups] might acquireinternational terrorism show no signs of biological agents, or less likely, aabating over the next 15 years. Experts nuclear device, either of whichassess that the majority of international could cause mass casualties.”terrorist groups will continue to identifywith radical Islam. The revival of Muslim There are indications that the Islamicidentity will create a framework for the radicals’ professed desire to create aspread of radical Islamic ideology both transnational insurgency, that is, a driveinside and outside the Middle East, by Muslim extremists to overthrow aincluding Western Europe, Southeast number of allegedly apostate secularAsia and Central Asia.• This revival has been accompanied by a deepening solidarity among 12 Hawalas constitute an informal banking system. 93
  • 93. governments with predominately Muslim inspired but more diffuse Islamicsubjects, will have an appeal to many extremist groups, all of which willMuslims. oppose the spread of many aspects of globalization into traditional Islamic• Anti-globalization and opposition to societies. US policies could cement a greater body of terrorist sympathizers, • Iraq and other possible conflicts in financiers, and collaborators. the future could provide recruitment, training grounds, technical skills and “…We expect that by 2020 language proficiency for a new class of terrorists who are “profession- al-Qa’ida will have been alized” and for whom political superceded by similarly inspired violence becomes an end in itself. but more diffuse Islamic • Foreign jihadists—individuals ready extremist groups.” to fight anywhere they believe Muslim lands are under attack byA Dispersed Set of Actors. Pressure what they see as “infidel invaders”—from the global counterterrorism effort, enjoy a growing sense of supporttogether with the impact of advances in from Muslims who are notinformation technology, will cause the necessarily supporters of terrorism.terrorist threat to become increasinglydecentralized, evolving into an eclectic Even if the number of extremistsarray of groups, cells, and individuals. dwindles, however, the terrorist threat isWhile taking advantage of sanctuaries likely to remain. Through the Internetaround the world to train, terrorists will and other wireless communicationsnot need a stationary headquarters to technologies, individuals with ill intentplan and carry out operations. Training will be able to rally adherents quickly onmaterials, targeting guidance, weapons a broader, even global, scale and do soknow-how, and fund-raising will obscurely. The rapid dispersion of bio-increasingly become virtual (i.e., online). and other lethal forms of technology increases the potential for an individualThe core al-Qa’ida membership not affiliated with any terrorist group toprobably will continue to dwindle, but be able to inflict widespread loss of life.other groups inspired by al-Qa’ida,regionally based groups, and individuals Weapons, Tactics, and Targets.labeled simply as jihadists—united by a In the past, terrorist organizations reliedcommon hatred of moderate regimes on state sponsors for training, weapons,and the West—are likely to conduct logistical support, travel documents, andterrorist attacks. The al-Qa’ida money in support of their operations. Inmembership that was distinguished by a globalized world, groups such ashaving trained in Afghanistan will Hizballah are increasingly self-sufficientgradually dissipate, to be replaced in in meeting these needs and may act in apart by the dispersion of the state-like manner to preserve “plausibleexperienced survivors of the conflict in deniability” by supplying other groups,Iraq. We expect that by 2020 al-Qa’ida working through third parties to meetwill have been superceded by similarly 94
  • 94. their objectives, and even engaging • Bioterrorism appears particularlygovernments diplomatically. suited to the smaller, better-informed groups. Indeed, the bioterrorist’sMost terrorist attacks will continue to laboratory could well be the size of aemploy primarily conventional weapons, household kitchen, and the weaponincorporating new twists to keep built there could be smaller than acounterterrorist planners off balance. toaster. Terrorist use of biologicalTerrorists probably will be most original agents is therefore likely, and thenot in the technologies or weapons they range of options will grow. Becauseemploy but rather in their operational the recognition of anthrax, smallpoxconcepts—i.e., the scope, design, or or other diseases is typicallysupport arrangements for attacks. delayed, under a “nightmare scenario” an attack could be well• One such concept that is likely to under way before authorities would continue is a large number of be cognizant of it. simultaneous attacks, possibly in widely separated locations. • The use of radiological dispersal devices can be effective in creatingWhile vehicle-borne improvised panic because of the public’sexplosive devices will remain popular as misconception of the capacity ofasymmetric weapons, terrorists are such attacks to kill large numbers oflikely to move up the technology ladder employ advanced explosives andunmanned aerial vehicles. With advances in the design of simplified nuclear weapons, terrorists “Terrorist use of biological will continue to seek to acquire fissile material in order to construct a nuclear agents is therefore likely, and weapon. Concurrently, they can be the range of options will grow.” expected to continue attempting to purchase or steal a weapon, particularlyThe religious zeal of extremist Muslim in Russia or Pakistan. Given theterrorists increases their desire to possibility that terrorists could acquireperpetrate attacks resulting in high nuclear weapons, the use of suchcasualties. Historically, religiously weapons by extremists before 2020inspired terrorism has been most cannot be ruled out.destructive because such groups arebound by few constraints. We expect that terrorists also will try to acquire and develop the capabilities toThe most worrisome trend has been an conduct cyber attacks to cause physicalintensified search by some terrorist damage to computer systems and togroups to obtain weapons of mass disrupt critical information networks.destruction. Our greatest concern isthat these groups might acquire The United States and its interestsbiological agents or less likely, a nuclear abroad will remain prime terroristdevice, either of which could cause targets, but more terrorist attacks mightmass casualties. 95
  • 95. Organized CrimeChanging geostrategic patterns will shape global organized criminal activity over thenext 15 years. Organized crime is likely to thrive in resource-rich states undergoingsignificant political and economic transformation, such as India, China, Russia, Nigeria,and Brazil as well as Cuba, if it sees the end of its one-party system. Some of theformer states of the Soviet Union and the Warsaw Pact also will remain vulnerable tohigh levels of organized crime.• States that transition to one-party systems—such as any new Islamic-run state—will be vulnerable to corruption and attendant organized crime, particularly if their ideology calls for substantial government involvement in the economy.• Changing patterns of migration may introduce some types of organized crime into countries that have not previously experienced it. Ethnic-based organized crime groups typically prey on members of their own diasporas and use them to gain footholds in new regions.Some organized crime syndicates will form loose alliances with one another. They willattempt to corrupt leaders of unstable, economically fragile, or failing states, insinuatethemselves into troubled banks and businesses, exploit information technologies, andcooperate with insurgent movements to control substantial geographic areas.Organized crime groups usually do not want to see governments toppled but thrive incountries where governments are weak, vulnerable to corruption, and unable orunwilling to consistently enforce the rule of law.• Criminal syndicates, particularly drug trafficking syndicates, may take virtual control of regions within failing states to which the central government cannot extend its writ.If governments in countries with WMD capabilities lose control of their inventories, therisk of organized crime trafficking in nuclear, biological, or chemical weapons willincrease between now and 2020.We expect that the relationship between terrorists and organized criminals will remainprimarily a matter of business, i.e., that terrorists will turn to criminals who can provideforged documents, smuggled weapons, or clandestine travel assistance when theterrorists cannot procure these goods and services on their own. Organized criminalgroups, however, are unlikely to form long-term strategic alliances with terrorists.Organized crime is motivated by the desire to make money and tends to regard anyactivity beyond that required to effect profit as bad for business. For their part, terroristleaders are concerned that ties to non-ideological partners will increase the chance ofsuccessful police penetration or that profits will seduce the faithful. 96
  • 96. Cyber Warfare? encounter the most severe and most frequent outbreaks of violence. For theOver the next 15 years, a growing range most part, those states most susceptibleof actors, including terrorists, may acquire to violence are in a great arc of instabilityand develop capabilities to conduct both from Sub-Saharan Africa, through Northphysical and cyber attacks against nodes Africa, into the Middle East, the Balkans,of the world’s information infrastructure, the Caucasus and South and Centralincluding the Internet, telecommunica- Asia and through parts of Southeast Asia.tions networks, and computer systems Countries in these regions are generallythat control critical industrial processes those “behind” the globalization curve.such as electricity grids, refineries, andflood control mechanisms. Terrorists • The number of internal conflicts isalready have specified the US information down significantly since the late 1980sinfrastructure as a target and currently and early 1990s, when the breakup ofare capable of physical attacks that would the Soviet Union and Communistcause at least brief, isolated disruptions. regimes in Central Europe allowedThe ability to respond to such attacks will suppressed ethnic and nationalistrequire critical technology to close the strife to flare. Although a leveling offgap between attacker and defender. point has been reached, the continued prevalence of troubled andA key cyber battlefield of the future will be institutionally weak states createsthe information on computer systems conditions for such conflicts to occurthemselves, which is far more valuable in the future.and vulnerable than physical systems.New technologies on the horizon provide “Lagging economies, ethniccapabilities for accessing data, either affiliations, intense religiousthrough wireless intercept, intrusion intoInternet-connected systems, or through convictions, and youth bulges willdirect access by insiders. align to create a ‘perfect storm’ [for] internal conflict.”be aimed at Middle Eastern regimes and Internal conflicts are often particularlyat Western Europe. vicious, long-lasting, and difficult to terminate. Many of these conflictsIntensifying Internal Conflicts generate internal displacements andLagging economies, ethnic affiliations, external refugee flows, destabilizingintense religious convictions, and youth neighboring countries.bulges will align to create a “perfectstorm,” creating conditions likely to spawn • Sub-Saharan Africa will continue to beinternal conflict. The governing capacity particularly at risk for major new orof states, however, will determine worsening humanitarian emergencieswhether and to what extent conflicts stemming from conflict. Genocidalactually occur. Those states unable both conflicts aimed at annihilating all orto satisfy the expectations of their part of a racial, religious, or ethnicpeoples and to resolve or quell conflicting group, and conflicts caused by otherdemands among them are likely to crimes against humanity—such as 97
  • 97. forced, large-scale expulsions of This does not eliminate the possibility of populations—are particularly likely to great power conflict, however. The generate migration and massive, absence of effective conflict resolution intractable humanitarian needs. mechanisms in some regions, the rise of nationalism in some states, and the raw “Africa in 2020 … will emotions on both sides of key issues increase the chances for miscalculation. increasingly resemble a patchwork quilt with significant • Although a military confrontation differences in economic and between China and Taiwan would political performance.” derail Beijing’s efforts to gain acceptance as a regional and globalSome internal conflicts, particularly those power, we cannot discount such athat involve ethnic groups straddling possibility. Events such as Taiwan’snational boundaries, risk escalating into proclamation of independence couldregional conflicts. At their most extreme, lead Beijing to take steps it otherwiseinternal conflicts can produce a failing or might want to avoid, just as China’sfailed state, with expanses of territory and military buildup enabling it to bringpopulations devoid of effective overwhelming force against Taiwangovernmental control. In such instances, increases the risk of military conflict.those territories can become sanctuariesfor transnational terrorists (like al-Qa’ida • India and Pakistan appear toin Afghanistan) or for criminals and drug understand the likely prices to be paidcartels (such as in Colombia). by triggering a conflict. But nationalistic feelings run high and areRising Powers: Tinder for Conflict? not likely to abate. Under plausibleThe likelihood of great power conflict scenarios Pakistan might use nuclearescalating into total war in the next 15 weapons to counter success by theyears is lower than at any time in the past larger Indian conventional forces,century, unlike during previous centuries particularly given Pakistan’s lack ofwhen local conflicts sparked world wars. strategic depth.The rigidities of alliance systems beforeWorld War I and during the interwar “Advances in modernperiod, as well as the two-bloc standoff weaponry—longer ranges,during the Cold War, virtually assuredthat small conflicts would be quickly precision delivery, and moregeneralized. Now, however, even if destructive conventionalconflict would break out over Taiwan or munitions—create circumstancesbetween India and Pakistan, outside encouraging the preemptive usepowers as well as the primary actors of military force.”would want to limit its extent.Additionally, the growing dependence on Should conflict occur that involved one orglobal financial and trade networks more of the great powers, theincreasingly will act as a deterrent to consequences would be significant.conflict among the great powers—the US, Advances in modern weaponry—longerEurope, China, India, Japan and Russia. 98
  • 98. How Can Sub-Saharan Africa Move Forward?Most of the regional experts we consulted believe the most likely scenario for Africa in 2020is that it will increasingly resemble a patchwork quilt with significant differences in economicand political performance.Africa’s capacity to benefit from the positive elements of globalization will depend on theextent to which individual countries can bring an end to conflict, improve governance, rein incorruption, and establish the rule of law. If progress is achieved in these areas, anexpansion of foreign investment, which currently is mostly confined to the oil sector, ispossible. Our regional experts felt that if African leaders used such investment to help theireconomies grow—opening avenues to wealth other than through the power of the state—they might be able to mitigate the myriad other problems facing their countries, with theprospect of prosperity decreasing the level of conflict.Expanded development of existing or new sources of wealth will remain key. Althoughmineral and natural resources are not evenly distributed among its countries, Sub-SaharanAfrica is well endowed with them and has the potential not only to be self-sufficient in food,but to become a major exporter of agricultural, animal, and fish products. The lowering orelimination of tariff barriers and agricultural subsidies in the European Union and the UnitedStates, combined with the demand for raw materials from the burgeoning Chinese andIndian economies, could provide major stimulus to African economies and overcomedecades of depressed commodity prices.African experts have agreed that economic reform and good governance are essential forhigh economic growth and also have concluded that African countries must take theinitiative in negotiating new aid and trade relationships that heretofore were essentiallydictated by the international financial institutions and the developed world. The NewPartnership for Africa’s Development (NEPAD), with its peer review mechanism, providesone mechanism for bringing about this economic transformation, if its members individuallyand collectively honor their commitments.Over the next 15 years, democratic reform will remain slow and imperfect in many countriesdue to a host of social and economic problems, but it is highly unlikely that democracy willbe challenged as the norm in Africa. African leaders face alliances of international anddomestic nongovernmental organizations that sometimes want to supplant certain stateservices, criminal networks that operate freely across borders, and Islamic groups bent onestablishing safehavens. Some states may fail but in others the overall quality ofdemocracy probably will increase. An emerging generation of leaders includes many fromthe private sector, who are more comfortable with democracy than their predecessors andwho could provide a strong political dynamic for democracy in the future.Leadership will remain the ultimate wild card, which, even in the least promisingcircumstances, could make a huge, positive difference. Although countries with poorleadership will find it harder not to fail, those with good leadership that promotes order,institutions, and conflict resolution will at least have a chance of progressing. 99
  • 99. ranges, precision delivery, and more neighbors and regional rivals alreadydestructive conventional munitions— are doing so.create circumstances encouraging thepreemptive use of military force. The • The assistance of proliferators,increased range of new missile and including former private entrepreneursaircraft delivery systems provides such as the A.Q. Khan network, willsanctuary to their possessors. reduce the time required for additional countries to develop nuclear weapons.Until strategic defenses become asstrong as strategic offenses, there will be “Countries without nucleargreat premiums associated with the abilityto expand conflicts geographically in weapons … may decide to seekorder to deny an attacker sanctuary. them as it becomes clear that theirMoreover, a number of recent high- neighbors and regional rivals aretechnology conflicts have demonstrated already doing so.”that the outcomes of early battles ofmajor conflicts most often determine the Chemical and Biological Weapons.success of entire campaigns. Under Developments in CW and BW agents andthese circumstances, military experts the proliferation of related expertise willbelieve preemption is likely to appear pose a substantial threat, particularly fromnecessary for strategic success. terrorists, as we have noted.The WMD Factor • Given the goal of some terroristNuclear Weapons. Over the next 15 groups to use weapons that can beyears, a number of countries will continue employed surreptitiously and generateto pursue their nuclear, chemical, and dramatic impact, we expect to seebiological weapons programs and in terrorist use of some readily availablesome cases will enhance their biological and chemical weapons.capabilities. Current nuclear weaponsstates will continue to improve the Countries will continue to integrate bothsurvivability of their deterrent forces and CW and BW production capabilities intoalmost certainly will improve the reliability, apparently legitimate commercialaccuracy, and lethality of their delivery infrastructures, further concealing themsystems as well as develop capabilities to from scrutiny, and BW/CW programs willpenetrate missile defenses. The open be less reliant on foreign suppliers.demonstration of nuclear capabilities byany state would further discredit the • Major advances in the biologicalcurrent nonproliferation regime, cause a sciences and information technologypossible shift in the balance of power, probably will accelerate the pace ofand increase the risk of conflicts BW agent development, increasingescalating into nuclear ones. the potential for agents that are more difficult to detect or to defend against.• Countries without nuclear weapons, Through 2020 some countries will especially in the Middle East and continue to try to develop chemical Northeast Asia, may decide to seek agents designed to circumvent the them as it becomes clear that their 100
  • 100. Chemical Weapons Convention 2020 several countries of concern verification regime. probably will have acquired Land-Attack Cruise Missiles (LACMs) capable of “Developments in CW and BW threatening the US Homeland if brought closer to US shores. Both North Korea agents and the proliferation of and Iran probably will have an ICBM related expertise will pose a capability well before 2020 and will be substantial threat, particularly working on improvements to enhance from terrorists...” such capabilities, although new regimes in either country could rethink theseDelivery Systems. Security will remain objectives. Several other countries areat risk from increasingly advanced and likely to develop space launch vehicleslethal ballistic and cruise missiles and (SLVs) by 2020 to put domestic satellitesunmanned aerial vehicles (UAVs). States in orbit and to enhance national prestige.almost certainly will continue to increase An SLV is a key stepping-stone toward anthe range, reliability, and accuracy of the ICBM: it could be used as a booster in anmissile systems in their inventories. By ICBM development. 101
  • 101. International Institutions in CrisisIncreased pressures on international institutions will incapacitate many, unless and untilthey can be radically adapted to accommodate new actors and new priorities.Regionally based institutions will be particularly challenged to meet the complextransnational threats posed by economic upheavals, terrorism, organized crime, andWMD proliferation. Such post-World War II creations as the United Nations andinternational financial institutions risk sliding into obsolescence unless they take intoconsideration the growing power of the rising powers.• Both supporters and opponents of multilateralism agree that Rwanda, Bosnia, and Somalia demonstrated the ineffectiveness, lack of preparation, and weaknesses of global and regional institutions to deal with what are likely to be the more common types of conflict in the future.The problem of state failure—which is a source or incubator for a number oftransnational threats—argues for better coordination between institutions, including theinternational financial ones and regional security bodies.Building a global consensus on how and when to intervene is likely to be the biggesthurdle to greater effectiveness but essential in many experts’ eyes if multilateralinstitutions are to live up to their potential and promise. Many states, especially theemerging powers, continue to worry about setting precedents for outside interventionthat can be used against them. Nevertheless, most problems, such as failing states,can only be effectively dealt with through early recognition and preventive measures.Other issues that are likely to emerge on the international agenda will add to thepressures on the collective international order as well as on individual countries. These“new” issues could become the staples of international diplomacy much as human rightsdid in the 1970s and 1980s. Ethical issues linked to biotechnological discoveries suchas cloning, GMOs, and access to biomedicines could become the source of hot debatesamong countries and regions. As technology increases the capabilities of states totrack terrorists, concerns about privacy and extraterritoriality may increasingly surfaceamong publics worldwide. Similarly, debates over environmental issues connected withtempering climate change risk scrambling the international order, pitting the US againstits traditional European allies, as well as developed countries against the developingworld, unless more global cooperation is achieved. Rising powers may see in theethical and environmental debates an attempt by the rich countries to slow down theirprogress by imposing “Western” standards or values. Institutional reform mightincreasingly surface as an issue. Many in the developing world believe power ininternational bodies is too much a snapshot of the post-World War II world rather thanthe current one. 102
  • 102. The Rules of War: Entering “No Man’s Land”With most armed conflict taking unconventional or irregular forms—such ashumanitarian interventions and operations designed to root out terrorist home bases—rather than conventional state-to-state warfare, the principles covering resort to, anduse of, military force will increasingly be called into question. Both the international lawenshrining territorial sovereignty and the Geneva Conventions governing the conduct ofwar were developed before transnational security threats like those of the twenty-firstcentury were envisioned.In the late 1990s, the outcry over former Serbian President Milosevic’s treatment ofKosovars spurred greater acceptance of the principle of international humanitarianinterventions, providing support to those in the “just war” tradition who have arguedsince the founding of the UN and before that the international community has a “duty tointervene” in order to prevent human rights atrocities. This principle, however,continues to be vigorously contested by countries worried about harm to the principle ofnational sovereignty.The legal status and rights of prisoners taken during military operations and suspectedof involvement in terrorism will be a subject of controversy—as with many capturedduring Operation ENDURING FREEDOM in Afghanistan. A debate over the degree towhich religious leaders and others who are perceived as abetting or inciting violenceshould be considered international terrorists is also likely to come to the fore.The Iraq war has raised questions about what kind of status, if any, to accord to theincreasing number of contractors used by the US military to provide security, man POWdetention centers, and interrogate POWs or detainees.Protection for nongovernmental organizations (NGOs) in conflict situations is anotherissue that has become more complicated as some charitable work—such as Wahabimissionaries funding terrorist causes—has received criticism and enforcement action atthe same time that Western and other NGOs have become “soft targets” in conflictsituations.The role of the United States in trying to set norms is itself an issue and probably willcomplicate efforts by the global community to come to an agreement on a new set ofrules. Containing and limiting the scale and savagery of conflicts will be aggravated bythe absence of clear rules. 103
  • 103. “Such post-World War II Fictional Scenario: Cycle of creations as the UN and Fear international financial institutions risk sliding into This scenario explores what might obsolescence unless they take happen if proliferation concerns into consideration the growing increased to the point that large- power of the developing world.” scale intrusive security measures were taken. In such a world, proliferators—such as illegal armsPost-Combat Environments Pose the merchants—might find itBiggest Challenge increasingly hard to operate, but at the same time, with the spread ofFor the United States particularly, if the WMD, more countries might want topast decades are any guide waging and arm themselves for their ownwinning a conventional war is unlikely to protection. This scenario is depictedbe much of a challenge over the next 15years in light of our overarching in a series of text-message exchangescapabilities to conduct such a war. between two arms dealers. One isHowever, the international community’s ideologically committed to levelingefforts to prevent outbreaks and ensure the playing field and ensuring thethat conflicts are not a prelude to new Muslim world has its share of WMD,ones could remain elusive. while the other is strictly for hire.• Nation-building is at best an Neither knows for sure who is at the imperfect concept, but more so with end of his chain—a government the growing importance of cultural, client or terrorist front. As the ethnic, and religious identities. scenario progresses, the cycle of fear originating with WMD-laden• Africa’s effort to build a regional terrorist attacks has gotten out of peacekeeping force shows some hand—to the benefit of the arms promise, but Sub-Saharan Africa will struggle with attracting sufficient dealers, who appear to be engaged in resources and political will. lucrative deals. However, fear begets fear. The draconian measures• The enormous costs in resources increasingly implemented by and time for meaningful nation- governments to stem proliferation building or post-conflict/failed state and guard against terrorism also stability operations are likely to be a serious constraint on such coalition have the arms dealers beginning to or international commitments. run scared. In all of this, globalization may be the real victim. 104
  • 104. Two arms dealers engage in unspecified illegal activity. . . . . . and are finding conducting business increasingly difficult. are u there? Marco contacted me How? In procuring it? No. Moving it. Too Youre kidding. Ure in Your telling me. already. Its going to many eyes on me. one of the poorest Dubai was so be difficult. countries civilized, but now its impossible to operate there. Dealer A (green phone) seems to think he is working for a country. Those terrorists are The material he is How do you know Cant know for Yeah I know youre I want my people and And to get back at ruining our business. you didnt help the certain, but I think interested in could be committed. Im in it faith to be respected. the Crusaders? That series of terrorists? my ultimate clients for the money. The bombs attacks spooked different. nuclear technology. Doesnt matter too important. everybody, not just However, he intimates much who pays just the Americans. so long as they do. that terrorists are also interested in doing business with him. Dealer B (gold phone) Both dealers indicate warns that the tide of they are increasingly international public worried about new That too. But the opinion may be turning Dont be so sure. Yeah they really got Yeah, went devices that can track I worry about the yanks are doing us a in favor of stronger Americas got a lot of the superpower on overboard. Still I them. chip. favor. Their military support cause of the the run. Even when it worry. Lots of people threats got my counter-proliferation terrorists. People also isnt WMD, they think sympathize, worry clients attention. He leery of attacks, it is. Regular hoof and even in Muslim world. cant wait now for because of the terrorist especially bw. mouth, I heard. Hard America also had its things to happen. The attacks. to tell the difference share of the real more talk of military at first. thing. A big hit action, the better, I happened before hoof say. And I have other and mouth. That new buyers who are Patriot Act went way interested. Lets say beyond anything more shady types. imagined after 9/11.
  • 105. Dealer A (in green) looks on the bright side. Got one imbedded in D-- well better not, You cant trust the But maybe not as With the world slipping Yeah, but thats not Which business? Ive you? but I dont beleive Americans, and they many as they think, if into a recession bad for business got several to tend to. what those guys have friends in the you know what I claim about world to help them. mean. because of the terrorist protecting privacy. Too much has attacks and the severe happened. martial clampdown, he thinks law. Talk of preemption, special he can get legitimate measures. Those operations last year businesses to look the wrapped up a big chain. other way. Dealer A (in green ) goes back to explainingYoure right. Lots of why the increased Lots of countries Against big brother. Big brother and some What do you mean? My clients scaredlegits going belly up. terrorist attacks have want an insurance of the smaller fry. s------- about theWhat happened to policy. terrorists and theirglobalization? Ha, ha. also increased capabilities. government interest in WMD programs. Conversation breaks off A month later. Dealer A (in black) again talks to Dealer at this point. B (in blue). Marco, the in-between mentioned in last months conversation, has changed aliases and is now . . . or they run them. known as Said, which may or may not be his realYeah some have Said contacted you? Yeah. No relation toturned into mini- name. The dealers quip about there being no relation marco, of course.states. is an obvious inside joke. The first dealer also reverts to his theme that the downturn in the world economy has been a boon to the illegal business. Legitimate businesses are now turning a blind eye and selling dual-use technology even when they have doubts about the end user. Dealers have also changed devices, which are shown in new colors.
  • 106. Dealer A (in black) is no doubt being intentionally cryptic about the material for fear of This recessions What do you mean? Makes the corporate Witting or unwitting? Id say witting, but Got the stuff through? interception. It may helping. world an easy target. with plausible deniability. have something to do with nuclear technology or possibly other illicit goods. This would indicate that One month later It is not clear if text authorities inside some messaging has failed to countries remain helpful go through, Dealer BA little hangup with Why the feds? It despite the clampdown Yeah but they traced has gone undergroundthe certification. wasnt transiting or outward cooperation it back from the Are u there?Corporate type told America. subsidiary. Got Where are u? or been swept up by ame he was with the United States. some help in other security roundup. Onequestioned. But he country. Have to bewas cool. He said extremely careful would hope Dealer A isFeds did not suspect. these days. They get confused by our now getting nervous. names. Cant keep up-marco, said, muhammed. Just dont have an ear for it. rned" "Lessons Lea attacks, and terrorist read of WMD greater sense of increasing sp to break. The erated by an · The fear cycle gen ould be one of the hardest quire WMD for protection once under way, w ight prompt more countr ies to ac or insecurity m factor, as deterrence. e ideological D would be th dealers would not be spread of WM story. Some mbating the ld and the ·A com one of exemplified byoney but to level the play em io plication in co the dealers in the scenar between the Muslim wor ing field in it for th ructed by West. was not obst r ation al commerce omic meltdown could spu so that intern ant since any econ it illegal · excess ive secu lance Achieving a ba rity would be import sinesses and scienti sts to engage in a highly lu crative, albe legitimate bu cle might activity. en the fear cy co operation wh international lenge. d sustaining D·eveloping an drive some to go it alone w ou ld be a chal
  • 107. Policy ImplicationsThe international order will be in greater shows, robust economic growthflux in the period out to 2020 than at any probably will help to overcomepoint since the end of the Second World divisions and pull more regions andWar. As we map the future, the countries into a new global order.prospects for global prosperity and the However, the rapid changes mightlimited likelihood of great power conflict also produce disorder at times; one ofprovide an overall favorable environment the lessons of that and the otherfor coping with the challenges ahead. scenarios is the need for managementDespite daunting challenges, the United to ensure globalization does not go offStates, in particular, will be better the rails.positioned than most countries to adapt tothe changing global environment. The evolving framework of international politics in all the scenarios suggests thatAs our scenarios illustrate, we see nonstate actors will continue to assumeseveral ways in which major global a more prominent role even though theychanges could begin to take shape and will not displace the nation-state. Suchbe buffeted or bolstered by the forces of actors range from terrorists, who willchange over the next 15 years. In a remain a threat to global security, tosense, the scenarios provide us with four NGOs and global firms, which exemplifydifferent lenses on future developments, largely positive forces by spreadingunderlining the wide range of factors, technology, promoting social anddiscontinuities, and uncertainties shaping economic progress, and providinga new global order. One lens is the humanitarian assistance.globalized economy, another is thesecurity role played by the US, a third is The United States and other countriesthe role of social and religious identity, throughout the world will continue to beand a fourth is the breakdown of the vulnerable to international order because of growing As we have noted in the Cycle of Fearinsecurity. They highlight various scenario, terrorist campaigns that“switching points” that could shift escalate to unprecedented heights,developments onto one path or the other. particularly if they involve WMD, are oneThe most important tipping points include of the few developments that couldthe impact of robust economic growth and threaten globalization.the spread of technology; the nature andextent of terrorism; the resiliency or Counterterrorism efforts in the yearsweakness of states, particularly in the ahead—against a more diverse set ofMiddle East, Central Asia, and Africa; and terrorists who are connected more bythe potential spread of conflict, including ideology and technology than bybetween states. geography—will be a more elusive challenge than focusing on a relatively• On balance, for example, as the centralized organization such as hypothetical Davos World scenario al-Qa’ida. The looser the connections 111
  • 108. Is the United States’ Technological Prowess at Risk?US investment in basic research and the innovative application of technology hasdirectly contributed to US leadership in economic and military power during the post-World War II era. Americans, for example, invented and commercialized thesemiconductor, the personal computer, and the Internet with other countries followingthe US lead.a While the United States is still the present leader, there are signs thisleadership is at risk.The number of US engineering graduates peaked in 1985 and is presently down 20percent from that level; the percentage of US undergraduates taking engineering is thesecond lowest of all developed countries. China graduates approximately three timesas many engineering students as the United States. However, post-9/11 securityconcerns have made it harder to attract incoming foreign students and, in some cases,foreign nationals available to work for US firms.b Non-US universities—for which a USvisa is not required—are attempting to exploit the situation and bolster their strength.Privately funded industrial research and development—which accounts for 60 percent ofthe US total—while up this year, suffered three previous years of decline.c Further,major multinational corporations are establishing corporate “research centers” outside ofthe United States.While these signs are ominous, the integrating character of globalization and theinherent strengths of the US economic system preclude a quick judgment of animpending US technological demise. By recent assessments, the United States is stillthe most competitive society in the world among major economies.d In a globalizedworld where information is rapidly shared—including cross-border sharing doneinternally by multinational corporations—the creator of new science or technology maynot necessarily be the beneficiary in the marketplace.a “Is America Losing Its Edge? Innovation in a Globalized World.” Adam Segal, Foreign Affairs, NovemberDecember 2004; New York, NY p.2.b “ Observations on S&T Trends and Their Potential Impact on Our Future.” William Wulf (President, NationalAcademy of Engineering). Paper submitted to the Center for Strategic and International Studies (CSIS) in supportof the National Intelligence Council 2020 Study, Summer 2004.c “ Is America Losing Its Edge?,” p.3.d Global Competitiveness Report 2004-2005, World Economic Forum, October 2004. 112
  • 109. among individual terrorists and various opportunities, and empowerment ofcells, the more difficult it will be to Muslim reformers would be vieweduncover and disrupt terrorist plotting. positively by the broad Muslim communities who do not support the• One of our scenarios—Pax radical agenda of Islamic extremists. A Americana—envisages a case in New Caliphate scenario dramatizes the which US and European consensus challenge of addressing the underlying on fighting terrorism would grow much causes of extremist violence, not just its stronger but, under other scenarios, manifest actions. including the hypothetical New Caliphate, US, Russian, Chinese and • The Middle East is unlikely to be the European interests diverge, possibly only battleground in which this limiting cooperation on struggle between extremists and counterterrorism. reformers occurs. European and other Muslims outside the Middle East “The US will have to battle world have played an important role in the internal ideological conflicts, and the public opinion, which has degree to which Muslim minorities feel dramatically shifted since the end integrated in European societies is of the Cold War.” likely to have a bearing on whether they see a clash of civilizations asThe success of the US-led global inevitable or not. Southeast Asia alsocounterterrorism campaign will hinge on has been increasingly a theater forthe capabilities and resolve of individual terrorism.countries to fight terrorism on their ownsoil. Efforts by Washington to bolster the Related to the terrorist threat is thecapabilities of local security forces in problem of the proliferation of WMD andother countries and to work with them on the potential for countries to havetheir priority issues (such as soaring increased motivation to acquire nuclearcrime) would be likely to increase weapons if their neighbors and regionalcooperation. rivals are doing so. As illustrated in the Cycle of Fear scenario, global efforts to• Defense of the US Homeland will erect greater barriers to the spread of begin overseas. As it becomes more WMD and to dissuade any other difficult for terrorists to enter the countries from seeking nuclear arms or United States, they are likely to try to other WMD as protection will continue to attack the Homeland from neighboring be a challenge. As various of our countries. scenarios underline, the communications revolution gives proliferators a certainA counterterrorism strategy that advantage in striking deals with eachapproaches the problem on multiple other and eluding the authorities, and thefronts offers the greatest chance of “assistance” they provide can cut yearscontaining—and ultimately reducing—the off the time it would take for countries toterrorist threat. The development of more develop nuclear political systems, broader economic 113
  • 110. How the World Sees the United StatesIn the six regional conferences that we hosted we asked participants about their views of therole of the United States as a driver in shaping developments in their regions and globally.AsiaParticipants felt that US preoccupation with the war on terrorism is largely irrelevant to thesecurity concerns of most Asians. The key question that the United States needs to ask itself iswhether it can offer Asian states an appealing vision of regional security and order that will rivaland perhaps exceed that offered by China.US disengagement from what matters to US Asian allies would increase the likelihood that theywould climb on Beijing’s bandwagon and allow China to create its own regional security orderthat excludes the United States.Participants felt that the rise of China need not be incompatible with a US-led internationalorder. The critical question is whether or not the order is flexible enough to adjust to a changingdistribution of power on a global level. An inflexible order would increase the likelihood ofpolitical conflict between emerging powers and the United States. If the order is flexible, it maybe possible to forge an accommodation with rising powers and strengthen the order in theprocess.Sub-Saharan AfricaSub-Saharan African leaders worry that the United States and other advantaged countries will“pull up the drawbridge” and abandon the region.Participants opined that the United States and other Western countries may not continue toaccept Africa’s most successful “export,” its people. The new African diaspora is composedoverwhelmingly of economic migrants rather than political migrants as in previous eras.Some participants felt that Africans worry that Western countries will see some African countriesas “hopeless” over the next 15 years because of prevailing economic conditions, ecologicalproblems, and political circumstances.Participants feared that the United States will focus only on those African countries that aresuccessful.Latin AmericaConference participants acknowledged that the United States is the key economic, political, andmilitary player in the hemisphere. At the same time, Washington was viewed as traditionally notpaying sustained attention to the region and, instead of responding to systemic problems, asreacting primarily to crises. Participants saw a fundamentalist trend in Washington that wouldlead to isolation and unilateralism and undercut cooperation. Most shared the view that the US“war on terrorism” had little to do with Latin America’s security concerns.Latin American migrants are a stabilizing force in relations with the United States. An importantpart of the US labor pool, migrants also remit home needed dollars along with new views ondemocratic governance and individual initiative that will have a positive impact on the region. (Continued on next page…) 114
  • 111. (Continued…) How the World Sees the United StatesUS policies also can have a positive impact. Some participants said the region would benefitfrom US application of regional mechanisms to resolve problems rather than punitive measuresagainst regimes not to its liking, such as that of Fidel Castro.Middle EastParticipants felt that the role of US foreign policy in the region will continue to be crucial. Theperceived propping up of corrupt regimes by the United States in exchange for secure oilsources has in itself helped to promote continued stagnation. Disengagement is highly unlikelybut would in itself have an incalculable effect.Regarding the prospects for democracy in the region, participants felt that the West placed toomuch emphasis on the holding of elections, which, while important, is only one element of thedemocratization process. There was general agreement that if the United States and Europecan engage with and encourage reformers rather than confront and hector, genuine democracywould be achieved sooner.Some Middle East experts argued that Washington has reinforced zero-sum politics in theregion by focusing on top Arab rulers and not cultivating ties with emerging leaders in andoutside the government.Although the Middle East has a lot to gain economically from globalization, it was agreed thatArabs/Muslims are nervous that certain aspects of globalization, especially the pervasiveinfluence of Western, particularly American, values and morality are a threat to traditionalcultural and religious values.Europe and EurasiaParticipants engaged in a lively debate over whether a rift between the US and Europe is likelyto occur over the next 15 years with some contending that a collapse of the US-EU partnershipwould occur as part of the collapse of the international system. Several participants contendedthat if the United States shifts its focus to Asia, the EU-US relationship could be strained to thebreaking point.• They were divided over whether China’s rise would draw the United States and Europe closer or not.• They also differed over the importance of common economic, environmental, and energy problems to the alliance.In our Eurasia workshop, participants agreed that the United States has only limited influenceon the domestic policies of the Central Asian states, although US success or failure in Iraqwould have spillover effects in Central Asia. Countries in western Eurasia, they believed, willcontinue to seek a balance between Russia and the West. In their view, Ukraine almostcertainly will continue to seek admission to NATO and the European Union while Georgia andMoldova probably will maintain their orientation in the same direction. 115
  • 112. “A counterterrorism strategy that for a budding relationship between approaches the problem on multiple Europe and China. fronts offers the greatest chance of As the Pax Americana scenario containing—and ultimately suggests, the transatlantic partnership reducing—the terrorist threat.” would be a key factor in Washington’s ability to remain the central pivot inOn the more positive side, one of the international politics. The degree tolikely features of the next 15 years is the which Europe is ready to shoulder moregreater availability of high technology, international responsibilities is unclearnot only to those who invent it. As we try and depends on its ability to surmount itsto make clear in our Davos World economic and demographic problems asscenario, the high-tech leaders are not well as forge a strategic vision for its rolethe only ones that can expect to make in the world. In other respects—GDP,gains, but also those societies that crossroads location, stable governments,integrate and apply the new technologies. and collective military expenditures—itFor example, our scenario points up the has the ability to increase its weight onbeneficial effects of possible new the international stage.technologies in Africa in helping toeradicate poverty. As we have noted “For Washington, dealing with aelsewhere in this paper, global firms willplay a key role in promoting more rising Asia may be the mostwidespread prosperity and more challenging of all its regionaltechnological innovation. relationships.”The dramatically altered geopolitical Asia is particularly important as anlandscape also presents a huge engine for change over the next 15 years.challenge for the international system as A key uncertainty is whether the rise ofwell as for the United States, which has China and India will occur smoothly. Abeen the security guarantor of the post- number of issues will be in play, includingWorld War II order. The possible the future of the world trading system,contours as several trends develop— advances in technology, and the shapeincluding rising powers in Asia, and scope of globalization. Forretrenchment in Eurasia, a roiling Middle Washington, dealing with a rising AsiaEast, and greater divisions in the may be the most challenging of all itstransatlantic partnership—remain regional relationships. One coulduncertain and variable. envisage a range of possibilities from the US enhancing its role as regional• With the lessening in ties formed balancer between contending forces to during the Cold War, nontraditional Washington being seen as increasingly ad hoc alliances are likely to develop. irrelevant. Both the Korea and Taiwan For example, shared interest in issues are likely to come to a head, and multilateralism as a cornerstone of how they are dealt with will be important international relations has been factors shaping future US-Asia ties as viewed by some scholars as the basis well as the US role in the region. Japan’s 116
  • 113. position in the region is also likely to be integrate those societies and regions thattransformed as it faces the challenge of a feel themselves left behind or rejectmore independent security role. elements of the globalization process. Providing economic opportunities alone “A key uncertainty is whether the may not be sufficient to enable the “have- nots” to benefit from globalization; rather, rise of China and India will occur the widespread trend toward religious and smoothly.” cultural identification suggests that various identities apart from the nation-With the rise of the Asian giants, US state will need to be accommodated in aeconomic and technological globalized world.advantages may be vulnerable toerosion. The interdependence that results from globalization places increasing• While interdependencies will grow, importance not only on maintaining increased Asian investment in high- stability in the areas of the world that tech research coupled with the rapid drive the global economy, where about growth of Asian markets will increase two thirds of the world’s population the region’s competitiveness across a resides, but also on helping the poor or wide range of economic and technical failing states scattered across a large activity. portion of the world’s surface which have yet to modernize and connect with the• US dependence on foreign oil larger, globalizing community. Two of our supplies also makes it more scenarios—Pax Americana and Davos vulnerable as the competition for World—point up the different roles that secure access grows and the risks of the United States is expected to play as supply-side disruptions increase. security provider and as a financial stabilizer.In the Middle East, market reforms,greater democracy, and progress toward Eurasia, especially Central Asia and thean Arab-Israeli peace would stem the Caucasus, probably will be an area ofshift towards more radical politics in the growing concern, with its large number ofregion and foster greater accord in the potentially failing states, radicalism in thetransatlantic partnership. Some of our form of Islamic extremism, andscenarios highlight the extent to which the importance as a supplier or conveyor beltMiddle East could remain at the center of for energy supplies to both West andan arc of instability extending from Africa East. The trajectories of these Eurasianthrough Central and Southeast Asia, states will be affected by external powersproviding fertile ground for terrorism and such as Russia, Europe, China, India andthe proliferation of WMD. the United States, which may be able to act as stabilizers. Russia is likely to beRealization of a Caliphate-like scenario particularly active in trying to preventwould pose the biggest challenge spillover, even though it has enormousbecause it would reject the foundations internal problems on its own plate.on which the current international system Farther to the West, Ukraine, Belarus,has been built. Such a possibility points and Moldova could offset theirup the need to find ways to engage and 117
  • 114. vulnerabilities as relatively new states by countries by 2020 would increase thecloser association with Europe and the potential cost of any military action byEU. the United States and its coalition partners.Parts of Africa share a similar profile withthe weak states of Eurasia and will • Most US adversaries, be they statescontinue to form part of an extended arc or nonstate actors, will recognize theof instability. As the hypothetical Davos military superiority of the UnitedWorld scenario suggests, globalization in States. Rather than acquiesce to USterms of rising commodity prices and force, they will try to circumvent orexpanded economic growth may be a minimize US strengths and exploitgodsend where good governance is also perceived weaknesses, usingput in place. North Africa may benefit asymmetric strategies, includingparticularly from growing ties with Europe. terrorism and illicit acquisition of WMD, as illustrated in the Cycle ofLatin America is likely to become a more Fear scenario.diverse set of countries: those thatmanage to exploit the opportunities “…no single country looks withinprovided by globalization will prosper,while those—such as the Andean nations striking distance of rivaling UScurrently—that do not or cannot will be military power by 2020.”left behind. Governance andleadership—often a wild card—will As our Pax Americana scenariodistinguish societies that prosper from dramatizes, the United States probablythose that remain ill-equipped to adapt. will continue to be called on to helpBoth regions may have success stories— manage such conflicts as Palestine,countries like Brazil or South Africa— North Korea, Taiwan, and Kashmir towhich can provide a model for others to ensure they do not get out of hand if afollow. The United States is uniquely peace settlement cannot be reached.positioned to facilitate Latin America However, the scenarios and trends wegrowth and integration stemming the analyze in the paper suggest thepotential for fragmentation. challenge will be to harness the power of new players to contribute to globalIn that vein, the number of interstate and security, potentially relieving the Unitedinternal conflicts has been ebbing, but States of some of the burden. Such atheir lethality and potential to grow in shift could usher in a new phase inimpact once they start is a trend we have international politics.noted. • China’s and, to a lesser extent, India’s• While no single country looks within increasing military spending and striking distance of rivaling US military investment plans suggest they might power by 2020, more countries will be be more able to undertake a larger in a position to contest the United security burden. States in their regions. The possession of chemical, biological, • International and regional institutions and/or nuclear weapons by more also would need to be reformed to 118
  • 115. meet the challenges and shoulder the media tends to magnify more of the burden. differences; on the other hand, the media can also facilitate discussionsAdapting the international order may also and increasingly challenging because ofthe growing number of other ethical The United States will have to battleissues that have the potential to divide world public opinion, which hasworldwide publics. These issues include dramatically shifted since the end of thethe environment and climate change, Cold War. Although some of the currentcloning and stem cell research, potential anti-Americanism13 is likely to lessen asbiotechnology and IT intrusions into globalization takes on more of a non-privacy, human rights, international law Western face, the younger generation ofregarding conflict, and the role of leaders—unlike during the post-Worldmultilateral institutions. War II period—has no personal recollection of the United States as itsMany ethical issues, which will become “liberator.” Thus, younger leaders aremore salient, cut across traditional more likely than their predecessors toalliances or groupings that were diverge with Washington’s thinking on aestablished to deal mainly with security range of issues.issues. Such divergent interestsunderline the challenge for the Finally, as the Pax Americana scenariointernational community, including the suggests, the United States may beUnited States, in having to deal with increasingly confronted with the challengemultiple, competing coalitions to achieve of managing—at an acceptable cost toresolution of some of these issues. itself—relations with Europe, Asia, the Middle East and others, absent a single• Whatever its eventual impact or overarching threat on which to build success, the Kyoto climate change consensus. For all the challenges ahead, treaty exemplifies how formerly the United States will nevertheless retain nontraditional policy issues can come enormous advantages, playing a pivotal to the fore and form the core of role across the broad range of issues— budding new networks or economic, technological, political, and partnerships. military—that no other state can or will match by 2020. Even as the existing• The media explosion cuts both ways: order is threatened, the United States will on the one hand, it makes it potentially have many opportunities to fashion a new harder to build a consensus because one. 13 The Pew Research survey of attitudes around the world revealed sharply rising anti-Americanism, especially in the Muslim world, but it also found that people in Muslim countries place a high value on such democratic values as freedom of expression, freedom of the press, multiparty political systems, and equal treatment under the law. Large majorities in almost every Muslim country favor free market economic systems and believe that Western-style democracy can work in their own country. 119
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