Lessons from ESPAS 2021

Lessons from ESPAS 2021

SAMI Fellows David Lye and Jonathan Blanchard Smith attended ESPAS 2021, the annual meeting of the European Strategy and Policy Analysis System, on 18-19 November. The second day of the conference was essential. David Lye noted the key elements from each session, which we share with you below.

Europe and the world in 2040: What kind of new international order?

  • China is not necessarily homogeneous; Chairman Xi has centralised more power, but there is push-back from some businesses/sectors and some regions. China is looking more inward –focussing on common prosperity and building resilience. There is a lot of resentment internally. China is alarmed and knows it needs to address this. It won’t want war over Taiwan. It is also diluting its Belt & Road commitments. However, it continues to engage with the developing world more than USA and EU are doing.  China will remain a superpower.
  • The EU needs to decide whether it is a Union of Values or wants to exercise power. The view from ESPAS is that it needs to go towards greater federalism to do the latter. If the EU is divided, it loses credibility. China should be the EU’s number 1 priority, with Russia number 2.
  • Japan seeks to be indispensable globally and strategically more autonomous, playing off the USA and China. It aims to build alliances with the US, EU and other democratic blocs.
  • In 2040, the world may be heading to a set of bifurcated worlds, e.g. different tech standards and ethics/values.

Future World Order?

  • The EU is inter-governmental – seen as technocratic; it underplays social policy and welfare, leaving those to nation-states.
  • China sees the European “Enlightenment” order as coming to an end. It has overplayed its hand on “wolf warrior” diplomacy, but even if it has moderated its approach slightly, it remains hostile to enlightenment values.
  • EU democratic values are contentious to many other states and regions. China could face its own “crisis of legitimacy”.

How will AI Change Humanity, and how can we manage our future?

  • We are just scratching the surface. 80% of the decisions humans make are affected by emotion – AI will affect, and be affected by, our emotions.
  • In a fast-changing world, AI based on historical data may be inadequate and wrong.
  • AI may help us to simulate different futures.
  • It may help decisions to be made faster, e.g. achieving the 1.5 degrees maximum.
  • We need to help people to understand AI and its potential effects on jobs and society. Difficult when there are many “unknown unknowns”.
  • Social scoring is NOT acceptable in Europe, but elsewhere it may well be.

Tomorrow’s world – and its risks, opportunities and choices for Europe

  • Acceleration of trends – global heating, sea-level rise; effect of the pandemic on how we work
  • Young people say, “in 40 years, we’ll all be dead.”
  • EU could be a “smart” power, setting norms and standards worldwide, but must get better at risk preparation and management.
  • EU needs strategic autonomy to aid resilience in the future. It needs to understand the world and the EU’s place – even if it is not as the EU would want it to be. It needs to work across silos, involving think tanks, the private sector etc.

How best to build back better? Towards a greener, fairer recovery

  • There’s a lot of good foresight work but no “road to action”. Ukraine and Crimea are examples.  We all saw it coming but did nothing.
  • Democracies need to work together but need variable geometry for different problem areas. But can’t address big global problems without non-democracies, like China, being involved.  Carbon pricing is an example; no agreed principles.
  • Other Regions look to the EU – when Africa asked for help with the pandemic, nothing much happened. Need fairness and equity, e.g. helping Africa achieve sustainable energy will involve some baseload energy.
  • We no longer understand how economics works due to digital transformation, green transformation, China’s rise, etc. Will demand for green capital increase or lower the price of capital? We don’t know.
  • How to replace revenue from carbon-based taxes?

ESPAS FORESIGHT REPORT

  • Global Heating has accelerated (IPCC)
  • Accelerating demographic change – China’s population model at 1.3 shows population halving by 2066. The same must apply to other East Asian countries.
  • Changes in the energy market, which includes the impact of climate change on renewables.
  • The world will recover from the pandemic by 2024, but Africa is the hardest hit and may struggle the most.
  • China will be the #1 economy in 2028.
  • We anticipate more cyberattacks, especially from China.
  • Use of migrants in asymmetric war.
  • Is Europe afraid? Can it show leadership?

Europe, America and The Indo-Pacific: the geopolitics of the future

  • Geopolitics went out of fashion after the Cold War; now, they are back.
  • In the 70s and 80s, the USA separated China from Russia, which weakened Russia, and turned out to be one of the critical drivers of Chinese success.
  • The rivalry between US and China will determine whether democratic values prevail.
  • 70% of the world’s semiconductors are produced in China.
  • Security will be the dominant concern. National security could lead to isolation – e.g. Trump’s USA, Brexit.

A US View: General HR McMaster. Former Chief Security Adviser

  • The West needs to stop doing things that feed its decline
  • China has its own problems: economic pressures and demographic change. It is driven by ambition and fear, making it fixated on “control”, leading to exclusion in crucial areas such as supply chains, technology and trade (Australia, Sri Lanka).
  • This creates debt traps for weak governments that do business with China.
  • There are many examples of Chinese aggression: The Himalayas, S China Sea, Taiwan; also cyber attacks and subversion of international bodies, such as WHO.
  • The West’s response should be self-confident. It should stop pouring money into China and stop believing Chinese hegemony is inevitable.
  • Suppression of critics is a sign of weakness in Russia and China.
  • The USA is frustrated with Europe, e.g. Germany and Nordstream2. But we are bound together.
  • India is potentially a powerful ally: potentially Brexit removes from the EU a colonial blot on relations with India.
  • We need to be more assertive economically and strategically and in defence of IPR.

ESPAS Takeaways and Next Steps

  • Involve other regions, e.g. Asia, in the EU’s foresight work.
  • And involve other sectors, e.g. business.
  • Explore alternative scenarios, including unwelcome ones.
  • Europe needs to be better prepared: defence, trade, technology and health.

In conclusion

The second day of the conference was precisely what ESPAS was designed to do – raising difficult and complex issues in an open, collaborative environment. We noted that there were few Asian contributors and only one from Africa. Whilst the pandemic makes things difficult, the absence of other global views was very striking. A more comprehensive range of contributors would have added to what was already a lively discussion.

Written by David Lye, SAMI Fellow and Jonathan Blanchard Smith SAMI Fellow and Director

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

Future-prepared firms outperform the average by 33% higher profitability and 200% higher growth. SAMI Consulting brings 30 years of experience delivering foresight, futures and scenario planning – enabling companies and organisations make “robust decisions in uncertain times”. Find out more www.samiconsulting.co.uk.

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