Rcent developments suggest that geoeconomics has displaced ‘classical’ geopolitics. It has become the statecraft of many countries to advance their geopolitical objectives. Now the ‘logic of conflict’ is in the ‘grammar of commerce’ where the loser state presumably ‘switches’ to the grammar of conflict that certainly damages the resilience of states. This is what is the weaponisation of economic interdependence that is used to remove hampering influences, and punish those countries which are found to be impediments in the path of promoting geopolitical interests of any powerful state.
After the ‘Washington Consensus’ in 1989, neoliberalism has become the global economic model, characterised by relative separation of the realms of security and economics. In contrast, geoeconomics converges both security and economics, and economic tools are used as instruments to achieve geopolitical ends. However, neoliberalism started to crumble in the aftermath of 2008 financial crisis. Now the Covid-19 pandemic perhaps becomes the last straw that might break the camel’s back. The collapse of market-based economic system not only paves the way for the emergence of new geoeconomics world order, but it also creates a hybrid economic system that defines the politics of the 21st Century. And also, great power rivalry would be primarily focused on geoeconomics, other sorts of conflicts seem no longer promptly inevitable.
Scholars opine that new contests would no longer be either ideological or geopolitical as that had been during the Cold War, it could be geoeconomics competition between great powers – particularly the US and China. Many observers also think that Sino-US competition would not escalate into a major confrontation mainly because of the tremendous cost of war. Nevertheless, although geoeconomics shapes the great power rivalry, the thick webs of economic interdependence reduces the possibilities of war. It is also debated that the US firms may not acquiesce to the government’s dictates to promote the geopolitical interests of the US at the expense of their profits. Nor the US government be able to intervene in the business of corporations as neoliberal economic system has divided the realms of security and economics. While China may be able to wield a great deal of clout as if its state-driven mercantilism advances its geopolitical interests.
Pakistan can also become a transit hub for the Central Asians countries to transport their natural gas resources to energy-starved regional countries, such as India, China and even Pakistan itself
However, geoeconomics statecraft is a potent tool by which powerful countries mobilise their economic potentialities to coerce the weaker states in order to gain geopolitical advantages in the realm of international politics. Global economic powers slap economic sanctions on poor countries to wield their influence on them in order to get them to do what they would not otherwise.Even many countries continue to pressurise the weaker countries to promote their geopolitical interest in certain regions.
Moreover, debts or loans are also instrumental to squeeze poor economies. The global financial institutions such the World Bank or the IMF or even economically dominant countries or their economic policies have been the major sources that trap weak economies and make them dependent in the long run. Notwithstanding debts or loans provide a some dose of temporary economic relief to the economically crippling countries, it should not be brushed aside that weak states will succumb to perpetual debts. It subsequently provides room for penetration into the state institutions to lender agencies, and it consequently creates political rupture and pitfalls in governance.
Let’s not forget that Pakistan has long been suffering from ‘dependency syndrome’. No wonder the US aid packages have been one of the chief causes of chronic ailment of Pakistan’s economy. The aid packages – and also loans from international financial institutions – have made the country a ‘client state’ of the US, and Washington has exploited the geostrategic position of Pakistan to advance its geopolitical interests in the region. It has even more or less compromised Islamabad’s ‘sovereignty’. Neither the aid packages nor loans have spurred economic growth of the country, it has done what only creating an unbreakable cycle of dependency on the US. This is what is the effective use of geoeconomic statecraft to advance geopolitical interests by a powerful country.
To illustrate, Malaysia, in the last year, hosted the Kula Lumper summit that could have addressed the problems faced by Muslim community across the world: Kashmir issue, the Middle East conflict in Syria and Yemen, the plight of Rohingya Muslims, mounting outrage over China’s camps for the Uighur Muslims, and growing Islamophobia. But Prime Minister Imran Khan didn’t attend it after his visit to Saudi Arabia just before the summit. Even though Kashmir dispute was one of the agendas of the summit, Islamabad couldn’t participate owing to ‘pressure’ from Saudi Arabia and the UAE. Pakistan often reaches out Saudi Arabia (and the UAE) for bailout packages for its struggling economy, and presence of large Pakistani diaspora, they are the major source of remittances, in both countries are attributed as the chief reasons that Islamabad didn’t take part in the summit. It is evident from the fact that Saudi Arabia’s geoeconomics statecraft has not only influenced Pakistan’s foreign policy, but it has also defended the interest of Saudi Arabia as it feared being diplomatically isolated by the Muslim world that may challenge its geopolitical status quo in the Muslim world.
Recently, the admission of India as a non-permanent member country of the United Nations Security Council is one of the manifestation of geoeconomics statecraft to ‘buy’ diplomatic allies in the international diplomatic markets. It is no secret that India has been using ‘naked aggression’ in the state of Jammu and Kashmir since the revocation of Kashmir’s special status on 5 August 2019. Though Kashmir issue is one of the oldest unresolved issues of the UN, there has been no such realisation to hold India accountable for its brute use of force against unarmed indigenous masses in the Valley. Nor is that to block the India’s admission to the UNSC as a non-permanent member unless it abides by the principles of the UNSC resolutions and International Law. India has fragrantly violated the UNSC resolutions that recognise Kashmir as a disputed territory between India and Pakistan. Yet, India has been elected as one of the non-permanent member state of the UNSC. Apparently, geoeconomics statecraft is potentially workable that not only coerces weak states, but it also helps buy clients in the international political markets to achieve geopolitical objectives.
Finally, the focal point of Pakistan’s foreign has always been geostrategic position of the country. However, Islamabad has always played its geostrategic card – indeed sometimes ‘smartly’ – to project its influence as a dominant regional actor, while it has given no considerable focus on its geoeconomic potentials in its external policies. Obviously, Pakistan’s geostrategic position with the combination of geoeconomics vitalities enable the country to play a pivotal role in international politics. The China-Pakistan Economic Corridor (CPEC) provides a network of regional connectivity that enables landlocked Central Asian Republics(CARs) to get access to maritime commercial network to expand their trade and other economic activities. Pakistan can also become a transit hub for the Central Asians countries to transport their natural gas resources to energy-starved regional countries, such as India, China and even Pakistan itself. Essentially, Islamabad must invest in geoeconomics subjects like science, education, production and trade that spur Pakistan’s national power. The effective use of both geoeconomics vitalities and geostrategic position of the country can bring revolutionary socioeconomic progress that enables Pakistan to ward off the perils of geoeconomics.
The writer is an analyst based in Islamabad