The Strategic Survey 2021

The International Institute for Strategic Studies (IISS), The International Institute for Strategic Studies (IISS)

• Publisher: Routledge
• Year: 2021
• ISBN:
  9781000563016
• Edition: 1
• Topic: Politics & International Relations
• Subtopic: National Security
• Index: Politics & International Relations

Strategic Survey 2021: The Annual Assessment of Geopolitics provides objective, in-depth analysis by leading experts of the events, actors and forces driving international relations. It is the indispensable guide for policymakers, business leaders, analysts and academics who need to understand the geopolitical and geo-economic trends shaping the global agenda in 2022 and beyond.

Key features

· Comprehensive annual review of world affairs from the International Institute for Strategic Studies, the leading international research institute that provides objective analysis of military, geopolitical and geo-economic developments that could lead to conflict.

· Covers developments in all regions as well as emerging issues and trends not yet on most radars, and analyses the major themes and forces shaping each continent.

· Essays on a comprehensive range of global issues including vaccine diplomacy, digital conflict, Europe's emerging Asia-Pacific strategies, the rise of carbon neutrality, the prospects for Iran's nuclear programme, and the future of political Islam.

· Drivers of Strategic Change for major states: Verified, comparable data on state power that provides a rich and vivid guide to forces underlying geopolitical change.

· Data-rich graphics and maps that provide fresh insights into geopolitical change, and a timeline of the key events of 2020–21.

Chapter 1

Introduction

Editor’s Introduction

2021 is the second year of pandemic and the first of recovery. While some countries emerge from lockdown, others face further devastation. But everywhere, COVID-19 remains a commanding issue shaping every aspect of life. For geopolitics, it is a global natural experiment testing state effectiveness, social cohesion and international relations. It has forced massive, urgent and complex decisions, especially in striking difficult balances between state power and citizens’ rights; between openness and security in flows of people across states; and between short-term national interest and the collective global good in vaccine production and distribution.

But the politics of pandemic are constantly and rapidly changing. Few countries have performed uniformly well or poorly – and some that fared worst in 2020 now fare best. What we at the IISS call ‘strategic sports commentary’ – the pundit stream of today’s ‘hot takes’ that become tomorrow’s myths dispelled – is soon forgotten. It is thus too early to draw reliable conclusions about the geopolitical consequences of COVID-19. And a great deal of geopolitics in an exceptionally eventful year has had little or nothing to do with the pandemic but remains rooted in the enduring features of international life: war, power and rules. All this vindicates the view we took in 2020 that Strategic Survey should remain geopolitics-centric, not become COVID-centric. The pandemic has not displaced geopolitics, merely refracted it.

New wars erupted in 2020–21 even as old ones in the Middle East and the Sahel ground on. China and India fought their most deadly clash since 1967. Azerbaijan’s defeat of Armenia in the second Nagorno-Karabakh war produced the biggest geopolitical shift in Eurasia since 2014 and prompted military planners elsewhere to study drone warfare more intently. Africa’s second-most-populous country, Ethiopia, began a major assault on its province of Tigray. America’s allies and adversaries alike are absorbing and interpreting both the fact and the manner of its withdrawal from Afghanistan.

War expresses irreconcilable interests; rules embody shared ones. Here, too, there were significant developments. With the end of the Brexit transition period in December 2020, that most ambitious rule-maker, the European Union, decoupled from the United Kingdom – whose readiness to consider a ‘specific and limited’ breach of international law sat ill with its commitment to a rules-based order. With one week to spare, the two sides agreed a Trade and Cooperation Agreement (TCA) to define their new relationship. But this remained unsettled and discordant, notably over the status of Northern Ireland – an issue that might yet erode the stability, and even integrity, of the UK. On the same day that the EU signed the TCA it also announced an ambitious Comprehensive Agreement on Investment with China. But the future of these rules, too, remained uncertain: in May 2021, the European Parliament suspended ratification of the agreement against the background of a deteriorating Sino-EU relationship.

There were breakthroughs too. The Abraham Accords that Israel signed with Bahrain, Morocco, Sudan and the United Arab Emirates marked an important shift in norms and relationships underpinning Middle Eastern politics, setting precedents that others may follow. Several countries, including China, bolstered the 2015 Paris Agreement on climate change – itself a landmark of global governance – with national commitments to achieve carbon neutrality. United States President Joe Biden rejoined the Agreement on his first day in office, signalling America’s return as an active multilateralist. His agreement with Russian President Vladimir Putin soon afterwards to renew the New START treaty saved strategic arms control from collapse. With remarkable speed, the new administration demonstrated the United States’ unique ability to concert ambitious cooperation by securing G7 adoption of a global minimum corporate tax rate on multinationals. No other country can still make rules like America.

In short, the unprecedented ‘cooperation gap’ between the demand for and supply of global governance identified by Strategic Survey 2020 did not widen and in some ways narrowed. But this hopeful development may not last. For the possibilities of cooperation, as of war, depend on power. And some of the most powerful states have been honing weapons short of war as their relations deteriorate. Russia’s hack of SolarWinds illustrated the wider escalation of cyber espionage and attack. Its biggest military build-up on Ukraine’s border since 2014 was a slow-motion exercise in coercive diplomacy. And regardless of any final judgement about the origins of COVID-19, the pandemic prompted a larger debate about the growing threat of biological weapons.

War, power and rules drive geopolitics. Leaders matters too: their choices turn these forces into effects. This was also a year of major leadership change. Japan’s and Israel’s long-serving prime ministers, Abe Shinzo and Benjamin Netanyahu, left office, as did the EU’s longest-serving leader, German chancellor Angela Merkel. Chad’s Idriss Déby, one of Africa’s veteran presidents, died in battle. Belarusian leader Alexander Lukashenko faced the most serious challenge to his 26-year rule as the country erupted in protest.

But most consequential of all was Donald Trump’s defeat in the November 2020 US elections. The events that followed drove America into uncharted territory. Genuine uncertainty over whether the military would support or remove Trump if he refused to leave; the unfounded yet widespread belief that the election was ‘stolen’; and the insurrection on Capitol Hill on 6 January 2021: all this amounted to the most serious challenge to American democracy and cohesion since the Civil War.

This reminds us that, within states as well as between them, power may become zero-sum, rules may wear thin, and even large-scale conflict is imaginable. When this happens in the world’s most powerful country and oldest democracy, the global implications must be great. At a minimum, it means America may be better at securing international cooperation than domestic consensus – its internal divisions could yet derail the historic G7 tax plan. Further polarisation would be more fateful – and there is no sign that the forces driving this have eased. No less than the wars, agreements and rivalries, America’s political turmoil may prove one of the most important geopolitical events of the past year.

September 2021

Drivers of Strategic Change

Geopolitics is driven by changes in the ability of states to use and resist power. The first depends on power resources, and the second on domestic resilience. Our Drivers of Strategic Change measure and compare key trends in both areas. They illuminate recent shifts in geopolitics and sources of potential future change.

Geopolitics is a craft, not a science: judgement, skill, chance and other immeasurable factors also shape international relations. But they do so within a range of possibilities set by the underlying domestic and external capacities of states. We encourage you to explore the rich data in our Drivers and the insights they yield.

The Drivers begin each geographical chapter. Unless otherwise stated, they chart change over 20 years by plotting data from 2000, 2010 and 2020.

Regional Share of Global Population, GDP and Defence Budget

(Sources: United Nations Department of Economic and Social Affairs; IMF; IISS, Military Balance; IISS, Military Balance+)

The first Driver depicts the region’s share of global population, GDP and defence budget. These are key power resources: the more of each that a country or region possesses, the greater its potential power, especially in combination. This Driver thus shows how the relative power of each region has changed over the past two decades.

The next six Drivers depict data for key selected countries in each region.

Population

(Source: United Nations Department of Economic and Social Affairs)

The second Driver shows population, age structure and median age. These are important for several reasons. Population is a power resource. A high proportion of young people – a ‘youth bulge’ – is a strong predictor of civil violence. It also presages a ‘demographic dividend’ of higher economic growth through future workforce growth, especially if fertility rates subsequently fall. Conversely, an ageing population means a high dependency ratio of economically inactive to active citizens, creating fiscal and productivity challenges that can limit resources needed to sustain power.

GDP

(Source: IMF)

The third Driver shows GDP and global ranking. The larger a country’s economy, the more of other forms of strength, including military hardware, it can procure.

GDP per Capita

(Source: IMF)

The fourth Driver shows GDP per capita, which has been shown to have a significant impact on the development of social values. Rising affluence leads to robust and predictable changes in political orientation – in particular, a decline in deference towards authority and a rise in demands for inclusion and participation.

Defence Budget and Active Military Personnel

(Sources: IISS, Military Balance; IISS, Military Balance+)

The fifth Driver shows defence budget and active military personnel, which are indicators of hard power.

Human Development Index (HDI)

(Source: UN Development Programme)

The sixth Driver shows Human Development Index scores, a composite measure of human well-being. This indicates a country’s ability to provide well-being and life chances for its population, with positive implications for governmental legitimacy and stability.

Political System

(Source: Freedom House, ‘Freedom in the World’)

The seventh Driver shows how democratic a political system is. Democratic legitimacy tends to produce stable and responsive government that is more resilient in a crisis. Conversely, the recent decline of democracy in some high-income countries, where the underlying demand for accountability remains high, may presage declining stability.

Regional Trends

The final Driver for each chapter uses a range of data to illuminate region-specific trends.

For Asia, Europe, Latin America and North America:

Trust in Government

(Source: Edelman Trust Barometer)

This Driver shows the general public’s average percentage of trust in government. Falling trust in governmental institutions – a recent feature of many countries – implies a decline in stability and cohesion. Questions that afforded respondents the opportunity to criticise their government were not asked in China, Russia and Thailand.

For Russia and Eurasia:

Approval Rating for President Vladimir Putin, and Assessment of the Current State of Affairs in Russia

(Source: Levada Center)

This Driver shows approval ratings for Russian President Vladimir Putin and popular views about the state of affairs in Russia. It highlights declining confidence that Russia is going ‘in the right direction’.

For the Middle East and North Africa:

Breakeven Oil Prices

(Sources: BP Statistical Review of World Energy 2021; IMF)

This Driver shows the oil price per barrel needed to ensure that planned government spending will not incur a budget deficit for 2016–21, together with the average annual oil price. This highlights the impact of post-2014 oil-price decline on the fiscal sustainability of oil-exportdependent states.

For sub-Saharan Africa:

Percentage of Children in Education

(Source: World Bank)

This Driver shows the gross percentage of children in education. The strong recent growth of education is a major investment in human capital that should l...