The war changed the global focus. Previously, countries concentrated on their own economic development within the then-existing world order. The world was like a straight-line race: whoever runs faster wins. After the start of Russia's full-scale aggression against Ukraine, the very essence of the game changed. Now everyone is playing predictions: what the new world order will be, how to protect themselves from losses during the transition process, and how to gain maximum benefit in the end. Whoever predicts the future better will win.
To play this game well, two global macro-trends should be considered. First, the world is transitioning to the sixth technological paradigm, within which artificial intelligence, robotics, and other cutting-edge technologies that weren't mainstream before the war will be drivers of corporate profitability and countries' economic development. Second, within this transition, an extremely important factor with massive global consequences will be the transformation of energy from fossil fuels to renewable energy sources and peaceful atom. The realization of these two macro-trends will radically change the economic balance in the world, according to which new geopolitical realities will be built.
The new technological, geoeconomic, and geopolitical landscape of the world will determine new vectors and means of transportation and new transport corridors. Each technological paradigm had favorite modes of transport and roads – this is a historical fact. It will be the same this time. And those countries that can predict how and where flows of goods, people, and technologies will run will be able to earn from this for the next decades.
The contours of new global transport corridors will be determined considering the following factors:
- If China's economy becomes more technological, low-tech production will migrate to PRC satellites but won't leave East and Southeast Asia. The global production center will remain in this region due to large population and high poverty rates.
- India may become the China of the new cycle, considering that in the context of the struggle for world hegemony, the US will try to develop alternatives to PRC in foreign trade.
- Europe will remain a center of purchasing power, first due to inertia and historically large economy size, and later, probably, as a result of mastering a number of sixth paradigm technologies, primarily energy and security. Over time, the European purchasing power center may migrate from west to east or north of Europe, but will maintain its strength for at least several more decades.
- Energy transformation will cause falling demand and prices for fossil fuels. As a result, between Asian production centers (China+satellites and probably India) and European purchasing power centers, a "Risk Belt" will form, consisting of once-wealthy oil and gas exporting countries, from Algeria, Libya through Western Asian countries to Russia. The key risk is that these countries face a long period of economic and political instability, and some may descend to Yemen or Somalia levels, systematically threatening global trade routes. However, there's also an advantage: these countries will competitively seek opportunities to compensate for losses from the depressed fossil fuel market, so they'll sign direct supply agreements with technological purchasing power centers and fight for global trade routes to pass through their territory.
- Russia has lost its status as a reliable transiter and regardless of the Russian-Ukrainian war results, won't be able to restore it in the coming decades for two reasons. First, significant reduction in oil and gas revenues may threaten Russia with economic and political upheavals on par with other "Risk Belt" countries. Weakening of the center, rising poverty and crime will create excessive risks for commodity flows regardless of whether this leads to Russia's collapse or not. Second, as long as Russia continues to dream of returning its former greatness, which was lost long ago and irrevocably, it will remain a threat to Europe, particularly Ukraine. Consequently, the EU's trade-economic blockade of Russia will persist.
- Due to excessive impoverishment, a number of "Risk Belt" countries will fall into political and economic dependence on China. Therefore, on one hand, China may become a real guarantor of certain (parts of) transport corridors that will cross the "Risk Belt." On the other hand, in the long term, PRC could take over Russia's role as a military-economic stimulator of regimes and groups threatening world trade flows, especially competitive, non-Chinese origin ones.
Two conclusions follow from this. First of all, in the new cycle between Asia and Europe, there will likely be at least two main trade routes competing with each other. It's not certain that even one of them will pass through the currently popular Suez Canal, given the security situation in the Red Sea and Gulf of Aden. At the same time, countries capable of establishing safe cargo passage through their territory and possessing or will possess necessary security technologies for this will have the highest chances of organizing sustainable transit for decades ahead.
In this context, two initiatives for creating Asia-Europe transport corridors have good potential: IDR (Iraq Development Road) and IMEC (India-Middle East-Europe Economic Corridor). Both started in 2023 and aimed at creating competition for the Suez Canal. The Iraq-initiated IDR project focuses on attracting transport flows from Asia through the Persian Gulf, Qatar, Iraq, Turkey to Europe. For it to become real, the Iran problem must be solved: it has historical scores with Iraq, claims alternative routes passing through its territory, particularly for transporting Chinese goods, and obviously has significant leverage over Persian Gulf shipping through de facto control over the Strait of Hormuz. That is, IDR project implementation involves solving a number of complex diplomatic and security issues, which may take some time regardless of when this transport corridor is actually built.
The IMEC transport corridor is an initiative with a wider circle of participants, including India, UAE, Saudi Arabia, Jordan, Israel, EU countries. Its strengths include Israel's participation, whose economy is quite technological and doesn't depend on fossil fuels, as well as Saudi Arabia and UAE – the largest and wealthiest oil exporters from the "Risk Belt," which thanks to formed reserves will be able to ensure their own economies' sustainability for a long time and have sufficient resources to invest in security. IMEC's weakness is that commodity flow must pass through the Strait of Hormuz to the Persian Gulf and Saudi Arabia and UAE ports located in it, or to Fujairah port (UAE) less than 100 km from the Iranian coast. Considering that IMEC was originally conceived as an alternative route for transporting specifically Indian goods, the Iran factor, a potential Chinese satellite, may become risky for this transport corridor. That is, IMEC project implementation also requires solving a number of security issues. But given which countries joined this project's participants, there are all prerequisites for this.
For Ukraine, the development of new transport corridors between Asia and Europe creates a number of strategic opportunities. First, Russia's transit potential weakens, which will make it weaker economically and geopolitically. Second, Ukraine possesses unique security technologies, particularly unmanned maritime systems, which proved their effectiveness on the Russian-Ukrainian war battlefields. This gives Ukraine a colossal chance for mutually beneficial cooperation with Israel and wealthy Arab countries in the direction of maritime security. Third, in the long term, in case of European purchasing power center migration to east and north Europe, Ukraine could become the northern continuation of Eurasian transport corridors, connecting Danube ports, railway crossings to Poland, Slovakia and Hungary, and Kyiv region transport hubs.
Ultimately, the emergence of new cycle transport corridors between Asia and Europe is not just an objective requirement of the time we live in, but also a significant strategic opportunity for Ukraine to join the formation of the new geoeconomic and geopolitical landscape of the world by establishing close, mutually beneficial cooperation with Middle Eastern countries.
