Ian Bremmer: Canada A 'Pivot' Country That Will Thrive In New World Disorder

The Huffington Post Canada  |  By Posted: 05/06/2012 10:31 am Updated: 05/06/2012 10:43 am

The world is moving into an era without any dominant global powers, and Canada will be among the winners in the new world disorder, a prominent risk analyst predicts in a new book.

Ian Bremmer, author of Every Nation For Itself: Winners and Losers In A G-Zero World, identifies Canada as one of the very few developed-world countries that will have a distinct economic edge as the world moves into a new phase of global power.

“We have entered what I like to call a 'G-Zero' world: one in which no single nation (not even the U.S.) or alliance of governments (certainly not the G-7 or G-20) possesses the political and economic muscle to drive an international agenda,” Bremmer writes at the Wall Street Journal. “In this new decentralized global order, growth isn't enough. A country also must have resilience—the power to pivot.”

As one of these “pivot” nations, Canada joins a list of mostly emerging economies as a country with the wind at its back in the coming years. Among other countries Bremmer identifies as winners are Brazil, Indonesia, Turkey and even Africa, which he describes as a “pivot continent.”

PHOTOS: THE WINNERS IN THE NEW 'G-ZERO' WORLD

Not surprisingly, Bremmer cites Canada’s commodity-heavy economy as the reason for its inclusion in the list, but he notes that one of the major factors in Canada’s sunny outlook is its decreasing dependence on the U.S. as a market.

“The percentage of Canada's exports to countries other than the U.S. jumped from 18 per cent in 2005 to more than 25 per cent just four years later, and Canada now draws nearly 40 per cent of its imports from countries other than the U.S.,” Bremmer writes.

In an interview with Salon, he argued that “it’s countries that are able to hedge and adapt between different models of growth and integration, that don’t get captured by any individual large country [that will thrive] and … Canada’s really good at doing that.”

Bremmer noted that British Columbia now exports more wood to China than it does to the U.S., and even pointed out that climate change will stand to benefit Canada in at least one way -- it will open the Northwest Passage in the Arctic, making Canada the centre of a new global shipping route.

Bremmer’s argument centres around the notion that the existing international institutions that act as the foundation of our economic order -- the G7, the G20, the IMF and so on -- no longer reflect the actual nature of global power, and so are sinking into irrelevance. No new institutions are on the horizon to take their place.

“The G7 group of industrialized democracies has become an anachronism, but the expanded G20 doesn’t work either, because there are too many players with too broad a range of interests and values seated around its negotiating table to produce agreement on anything more demanding than high-minded declarations of principle,” he writes at Reuters.

“In short, we are now living with a G-Zero order, one in which no single power or alliance of powers has the muscle, the means and the will to provide the leadership needed to tackle a growing list of transnational threats.”

THE WINNERS IN THE NEW 'G-ZERO' WORLD

[Text version follows below.]

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  • Brazil

    "Brazil, which recently surpassed Britain to become the world's sixth-largest economy, has many promising advantages," Bremmer writes in the Wall Street Journal. "With a middle class of more than 100 million, it is home to Latin America's largest consumer market. Its government, led by a party of the left, has established a national consensus in favor of market- and investor-friendly economic policies. Though huge offshore oil discoveries in 2007 ensure that the country will become a leading energy exporter, its economy is well diversified."

  • Turkey

    "Turkey's bid to join the European Union is going nowhere, but Ankara is actively expanding its international influence," Bremmer writes. "It is an increasingly important emerging market, with per capita income nearly double that of China and four times that of India. Many in the Arab world look to Turkey as a dynamic, modern Muslim state. Add to this its position at the crossroads of Europe, Asia, the Middle East and the former Soviet Union, and Turkey is the very model of a modern major pivot state."

  • Indonesia

    "Indonesia, with the world's fourth-largest population, enjoys a stable political environment with solid growth and a well-diversified economy," Bremmer writes. "Its trade ties are well balanced among China, the U.S., Japan and Singapore--and are likely to remain so."

  • Africa - The Pivot Continent

    Bremmer sets aside conventional pessimism about Africa's prospects and points out that, with Chinese businesses looking for resources and markets for their goods across the continent, the continent is set to boom in the coming years.<br> <br> "For years, cash-strapped African states had to turn almost exclusively to the IMF, World Bank and Western governments for financial help," Bremmer write. "But in 2010 alone, China's trade with Africa expanded by more than 43%, according to official Chinese trade data, and it replaced the U.S. as Africa's largest trade partner."<br> <br> Bremmer predicts: "Africa can now expect multinational and state-owned companies from developed and developing states to compete for access to African consumers and favorable investment terms. This isn't a story of the West losing out to China, because both will continue to profit in Africa. The winners here are all the newly resilient African governments."

  • Singapore

    "Tiny Singapore proves that a country's size need not limit its international options," writes Bremmer. "The island city-state sits at the mouth of the strategically vital Strait of Malacca. Its per capita GDP is among the highest in the world. Unemployment hovers at about 2 per cent. Singapore's government has worked to marry Eastern culture and Western business practices, and the country is now the world's fourth leading financial center, behind London, New York and Hong Kong. Many foreign companies looking to set up shop in Asia want a base that allows them access to all of Asia's power economies without overreliance on any of them, and Singapore fits the bill."

  • Kazakhstan

    The former Soviet republic of Kazakhstan has become an energy superpower thanks to its oil and gas reserves, Bremmer writes.<br> <br> "Kazakhstan is already profiting from its position as a pivot state," he says. "It has built one of the world's fastest-growing economies, thanks mainly to the large-scale export of oil, metals and grains, which helps to ensure that it doesn't rely too heavily for trade on Russia, its former Soviet neighbor, or on China. Almaty, the country's largest city, has become an important regional financial center."

  • Vietnam

    "Day may finally be about to break" in Vietnam, <a href="http://eurasia.foreignpolicy.com/posts/2010/02/25/the_rise_of_vietnam" target="_hplink">Bremmer writes at Foreign Policy</a>. "Vietnam remained politically stable through the tough times, and, despite pressure from conservatives, the bureaucracy has largely remained committed to reform.<br> <br> "The new buzzword is stability, not growth at all costs, but investors are again buzzing about opportunities in Vietnam's major cities and its provinces with export zones, and we're seeing a spike in interest ... in Vietnam's export infrastructure."<br> <br> And given the recent political instability in neighbouring Thailand, Bremmer adds, "Vietnam has never looked sunnier."

  • Canada

    Canada's wealth of natural resources ensures that it will make money in the 21st century as demand for commodities grows, Bremmer writes, but Canada's weakness is its heavy dependence on the U.S. as its principal export market. But that is changing, Bremmer notes.<br> <br> "The percentage of Canada's exports to countries other than the U.S. jumped from 18% in 2005 to more than 25% just four years later, and Canada now draws nearly 40% of its imports from countries other than the U.S.," Bremmer writes in the Wall Street Journal.<br> <br> "In addition, Canada's economy is well diversified. Like Mexico, it exports large volumes of oil. But it also produces substantial quantities of natural gas, industrial machinery, auto parts and timber and exports them to many different consumer markets."

Brazil

"Brazil, which recently surpassed Britain to become the world's sixth-largest economy, has many promising advantages," Bremmer writes in the Wall Street Journal. "With a middle class of more than 100 million, it is home to Latin America's largest consumer market. Its government, led by a party of the left, has established a national consensus in favor of market- and investor-friendly economic policies. Though huge offshore oil discoveries in 2007 ensure that the country will become a leading energy exporter, its economy is well diversified."

Turkey

"Turkey's bid to join the European Union is going nowhere, but Ankara is actively expanding its international influence," Bremmer writes. "It is an increasingly important emerging market, with per capita income nearly double that of China and four times that of India. Many in the Arab world look to Turkey as a dynamic, modern Muslim state. Add to this its position at the crossroads of Europe, Asia, the Middle East and the former Soviet Union, and Turkey is the very model of a modern major pivot state."

Indonesia

"Indonesia, with the world's fourth-largest population, enjoys a stable political environment with solid growth and a well-diversified economy," Bremmer writes. "Its trade ties are well balanced among China, the U.S., Japan and Singapore--and are likely to remain so."

Africa - The 'Pivot Continent'

Bremmer sets aside conventional pessimism about Africa's prospects and points out that, with Chinese businesses looking for resources and markets for their goods across the continent, the continent is set to boom in the coming years.

"For years, cash-strapped African states had to turn almost exclusively to the IMF, World Bank and Western governments for financial help," Bremmer write. "But in 2010 alone, China's trade with Africa expanded by more than 43 per cent, according to official Chinese trade data, and it replaced the U.S. as Africa's largest trade partner."

Bremmer predicts: "Africa can now expect multinational and state-owned companies from developed and developing states to compete for access to African consumers and favorable investment terms. This isn't a story of the West losing out to China, because both will continue to profit in Africa. The winners here are all the newly resilient African governments."

Singapore

"Tiny Singapore proves that a country's size need not limit its international options," writes Bremmer. "The island city-state sits at the mouth of the strategically vital Strait of Malacca. Its per capita GDP is among the highest in the world. Unemployment hovers at about 2 per cent. Singapore's government has worked to marry Eastern culture and Western business practices, and the country is now the world's fourth leading financial center, behind London, New York and Hong Kong. Many foreign companies looking to set up shop in Asia want a base that allows them access to all of Asia's power economies without overreliance on any of them, and Singapore fits the bill."

Kazakhstan

The former Soviet republic of Kazakhstan has become an energy superpower thanks to its oil and gas reserves, Bremmer writes.

"Kazakhstan is already profiting from its position as a pivot state," he says. "It has built one of the world's fastest-growing economies, thanks mainly to the large-scale export of oil, metals and grains, which helps to ensure that it doesn't rely too heavily for trade on Russia, its former Soviet neighbor, or on China. Almaty, the country's largest city, has become an important regional financial center."

Vietnam

"Day may finally be about to break" in Vietnam, Bremmer writes at Foreign Policy. "Vietnam remained politically stable through the tough times, and, despite pressure from conservatives, the bureaucracy has largely remained committed to reform.

"The new buzzword is stability, not growth at all costs, but investors are again buzzing about opportunities in Vietnam's major cities and its provinces with export zones, and we're seeing a spike in interest ... in Vietnam's export infrastructure."

And given the recent political instability in neighbouring Thailand, Bremmer adds, "Vietnam has never looked sunnier."

Canada

Canada's wealth of natural resources ensures that it will make money in the 21st century as demand for commodities grows, Bremmer writes, but Canada's weakness is its heavy dependence on the U.S. as its principal export market. But that is changing, Bremmer notes.

"The percentage of Canada's exports to countries other than the U.S. jumped from 18 per cent in 2005 to more than 25 per cent just four years later, and Canada now draws nearly 40 per cent of its imports from countries other than the U.S.," Bremmer writes in the Wall Street Journal.

"In addition, Canada's economy is well diversified. Like Mexico, it exports large volumes of oil. But it also produces substantial quantities of natural gas, industrial machinery, auto parts and timber and exports them to many different consumer markets."

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01:36 AM on 05/08/2012
Nice thought, but this country's economic success is driven by its resource extraction and its willingness to be totally open to anyone who wants a piece. The TSX is often a direct reflection of this. We aren't the king of anything, and to think we will be is hubris.
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albertarick
These are questions for wise men with skinny arms
10:21 PM on 05/06/2012
This Bremmer guy is famous for an upside down lopsided bell curve graph. Let's not place too much value on what he says.
07:43 AM on 05/07/2012
Also, doesn't take much of a brain to conclude he is most likely correct.
07:54 PM on 05/06/2012
Huffpo loves to wave red flags in front of charging bulls. I have had this same hunch for twenty years after doing quite a bit of travel. For the most part Canada has a population that is respectful of others. Immigrants do better here than anywhere. It is full of resources, has property rights, the rule of law, education that is available to a large swath of people and a culture that by and large knows you have to work hard to get anywhere. We have very productive farmland, very few natural disasters, a cold winter to make people do some nesting. Add oil, uranium, potash, diamonds, gold and the best source of valuable fresh water on earth. If the world ever gets around to the hydrogen economy we are poised to be the Saudis of this energy source. As much as the locals hate Harper (I suppose hate is useful) we can turf them out and with a majority turn Canada in a new direction quite quickly. This is better than the US system which is mired in Gridlock. Ultimately the US has the most valuable land on earth, as you can grow so much food there. The only thing that can hold us back and keep us from keeping our heads above water would be mass social suicide. This could happen overnight really as humans seem to love screwing it up when they have it good.
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HUFFPOST SUPER USER
cordierite
always misunderstood
04:13 PM on 05/07/2012
Respectful of others? Wouldn't say that. At some times no and when some of your country's people are overseas you certainly show your disrespect in the sneakiest of ways.
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HUFFPOST SUPER USER
Larry Mutter
07:29 PM on 05/06/2012
Why does it always have to be about competition? oh yes capitalism.Lets wait until everybody else is in ruins so we can take over.
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HUFFPOST SUPER USER
ethrop
micro-bio-tic
07:19 PM on 05/06/2012
Ok. But we are powered by dirty oil. This is bad news in the coming decade. We are riding a wave of prosperity on the back of a seriously nasty piece of business. It will stop sooner than later and I hate to see how the national economy reacts. The other problem we are starting to have is acting like the US in the politics of exclusion. A tide rises all boats but I think we are starting to leak. Social gaps are increasing. This comes down to the complicated schemes of wealth distribution. I don't trust the Harper government to even know how this shoudl work...
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HUFFPOST SUPER USER
gravescanada
11:20 AM on 05/07/2012
Fanned and Faved! I could not have put it any better.
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HUFFPOST SUPER USER
SayBlade
This micro bio intentionally left blank.
03:48 PM on 05/07/2012
I have always thought that saying "a rising tide floats all boats" was rather comical since it assumes everyone has a boat and it is in good repair.

Fanned and faved.
This comment has been removed due to violations of our [Guidelines]
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turkeylurky
Just keepin it real........
06:12 PM on 05/06/2012
B-b-b-b-b-but this can't be - Harper and the Conservatives have destroyed Canada....
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07:00 PM on 05/06/2012
You think Harper had anything to do with Canada economic strength. Bwahaha! In 6 years, Harper has blown the entire Liberal surplus they us and is spending Canada back into the Mulroney red, again. We’ll be joining the rest of the world in the same economic chaos—you just watch!
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HUFFPOST SUPER USER
cwebster
predominantly exasperated
02:37 AM on 05/07/2012
They are doing their best...give them time and they will mess us up royally.
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Trashcan Man
Luck does not reduce risk even when it seems to.
06:06 PM on 05/06/2012
Meaning that Canada will have the greatest ability to allow transnational corporations to extract wealth from the population. There is nothing in the article regarding quality of life for citizens only corporations.
If the benefits of resource extraction benefit a few then what's the point?
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HUFFPOST SUPER USER
gravescanada
11:36 AM on 05/07/2012
Meanwhile the Finance Minister had to be told by the Prime Minister to quit trying to sabotage the Ontario Economy with his constant statements against the governing party. How UN-Canadian is that?
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Add In Canadia
Egotism is a weakness
05:08 PM on 05/06/2012
Economic growth in a globalized economy always comes at the expense at someone, and the cost is going to be from many of the first world nations which have grown accustomed to their higher standard of living. We are already witnessing the shrinking middle class in these nations, and the rise of of the middle class in others.

We aren't at the tipping point yet, our 'poor' and 'middle' class are still doing significantly better than many other nations, but this gap is shrinking. There's always rich people somewhere in the world that will horde it (or in some cases us it to actually create a stable middle class) but as far as the metrics of a strong middle class, many established first world nations are seeing it shrink.

The global economy isn't about attracting skilled workers anymore, it's about attracting businesses; and political stability is playing less and less of a role in a corporation's operation, because bribery, security, and infrastructure are simply becoming part of the cost of doing business.

We may reach the point in where Canadians will have to emigrate to find work, but our natural resources will ensure that we remain with the flow of the world. That is if we don't sell out everything we have to outside interests. Might just end up seeing our natural resources being re-nationalized down the road if every other aspect of our economy collapses from world pressure.
08:12 PM on 05/06/2012
I do agree with much of what you say but I believe your reasoning is a little off.


The major eason for the shrinking middle class in developed nations is the ridiculous "trickle down " theory of economics championed by Reagan, Thatcher, and in Canada by Mulroney jumping on their bandwagon. At the same time , past governments discarded the progressive tax system which had produced a decent standard of living for the greatest number and resulted in a middle class that picked up a fair share of the tax burden. At the time the federal government revenues came pretty equally from corporations and and the general public. We can again have a fair and equitable distribution of the benefits of economic productivity with a return to such a system.

Furthermore, we have to establish strong and rigorous control over the financial business, the sale of Canadian assets, be they commodity, intellectual , farming or manufacturing to offshore interests. If we are not careful the Reform/Conservatives will sell all our assets to foreign countries, using as an excuse that it is just free trade. Example..on the sale of the Nickel Co. of Canada to a Brazilian company, his only comment was that the last time he looked the mine was still in Canada. May be true, but the wealth it produces is being transferred offshore. This is happening all over the country where foreign companies are in control.
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Rob Vann
Hope for the best,Plan for the worst,Take what cms
04:38 PM on 05/06/2012
What happens to Canada if the Central US turns into a dust-bowel and the price of water is more than gasoline.. How do you pivot with a boot on your neck?
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Douglas Sinclair
sufferin' succotash!
04:41 PM on 05/06/2012
See article on War of 1812 in today's Post and comments on differing versions of history.
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sgillhoolley
Occupy the discussion.
05:44 PM on 05/06/2012
How is the USA our problem? Mexico has long been a weak government and economy, but they lay to the south of the USA and have not pulled it down with them. If the price of water goes that high we are clearly in a good position, having one of the largest supplies of fresh water in the world. Since our dependance upon the US market has dimished so much over the past decade, their decline will have less and less of an affect upon us.
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Rob Vann
Hope for the best,Plan for the worst,Take what cms
06:41 PM on 05/06/2012
Not at the moment. I'm just posing a hypothetical question as the article does not consider the impact of the climate change on relations between Canada and the US. Gwynne Dyer makes the point that Climate Change will redefine national boundaries via the migration of populations north into Canada.

Being in a favorable position to sell water, oil or any other commodity can change very quickly when your neighbour considers access to vital resources a national security issue... they get what they want.. Otherwise why the concern about Chinese investment and our efforts to diversify our export markets.
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04:12 PM on 05/06/2012
I don't care what these so called "experts" have to say. It all means NOTHING without a HEALTHY environment. We simply cannot keep raping the planet of resources and using it as a continual DUMPING GROUND for our incessant need for 'STUFF"!
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Douglas Sinclair
sufferin' succotash!
03:51 PM on 05/06/2012
Canada has natural resources. Manufacturers need natural resources. Canada does not support or promote domestic manufacturing. Hewers of wood and drawers of water is ingrained in the national psyche. Canada has no independent foreign policy. Canada does not support: its artists, aboriginal people, athletes, medical researchers, scientist, statisticians....
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sunnyokanagan
Increase compassion. Decrease suffering
03:13 PM on 05/06/2012
National governments are irrelevant. The new super-powers are trans-national corporations. Borders, sovereignty: meaningless anachronisms. Capital is beholden to no nation. If there is a "new world order", this is it.
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sgillhoolley
Occupy the discussion.
05:46 PM on 05/06/2012
I disagree, and I believe we are about to see the pushback against corporate power in the coming few years.
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Rob Vann
Hope for the best,Plan for the worst,Take what cms
07:10 PM on 05/06/2012
The pushback is happening.. and in a perfect democracy guaranteed to succeed.

In the US they have the "Best democracy money can buy"..

it's not going to happen without a messy struggle and a lot of folks waking up from their media induced sleep.
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sunnyokanagan
Increase compassion. Decrease suffering
08:23 PM on 05/06/2012
I hope the push-back comes about, I really do. Could Canada be a test case?

I contend that the current Government is dominated by a Corporatist regime. It was voted into power in [what passes in this country for] democratic elections. The public is more-or-less well-educated. More and more evidence is coming to light every week that the Government of the day is willing to use extra-legal (or certainly immoral) tactics to attain and remain in power.

The system of governance doesn't require the Government of the day to improve their behaviour, and the rules say the next opportunity to replace the Government by election is October of 2015.

So the question becomes: what form of "push-back" are the people of Canada willing to undertake in order to roll back a possible Corporatist coup d'état?
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SeanMartin
Everything in moderation.
02:52 PM on 05/06/2012
Our temporary and less-than-stellar government aside, let's get real: Canada's doing it right... and has been for quite some time. We should definitely be proud of ourselves and what we, as a country, have accomplished... and we did it without running all over the world telling everyone what a superduperpower we were. We just did it. Good for us, eh?
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HUFFPOST SUPER USER
skbull44
Check out Olduvai the novel
02:50 PM on 05/06/2012
Mojoliveshere began the conversation and I agree that growth is the problem. But perhaps not in the way economists think. The current economic system relies on growth and not just any growth, exponential growth. In a world with unlimited resources such growth may be possible; but in our finite world it is not.
Therein seems to lie the crux of our problem, our 'prosperity' relies on infinite growth, including infinite growth in our supply of resources. And, as Richard Heinberg argues in his book, The End of Growth, we are running into the restrictions of a finite supply of resources, most especially cheap and easily accessible oil.
Sure, Canada has a 'good' supply now and may be among the lucky as we transition into a post-carbon world, but such 'supremacy' is not likely to last long as Petroleum 'Man' retreats into the annals of history as a one-time blip in the human species that selfishly used up the end of its millions-year-old energy bubble in a matter of a couple of centuries and then faded from memory...

See www.zerogrowthnow.ca