From Unipolar to Multipolar: The Evolution of Economic Blocs
- Rise of Economic Blocs: Alliances like BRICS and SCO are challenging U.S. dominance by promoting regional cooperation, alternative currencies, and reduced dependence on Western systems.
- China's Economic Power: China's rapid growth, mega-projects like the Belt and Road Initiative, and global soft power play a central role in reshaping the global order.
- Middle-Power Influence: Countries like India, Brazil, and Saudi Arabia are leveraging their economic, military, and geopolitical strengths to shape a multipolar world.
As Paul Michael Kennedy stated in The Rise and Fall of the Great Powers: “The relative strengths of the leading nations in world affairs never remain constant, principally because of the uneven rate of growth among different societies.” This observation rings true today as the global system is shifting from unipolar to multipolar, not through military might but via the emergence of economic blocs such as BRICS and the Shanghai Cooperation Organization (SCO). While significant transitions in global systems often bring challenges or conflicts, this shift appears to be unfolding smoothly as superpowers and middle powers collaborate. Several factors drive this change: China’s rise as an economic powerhouse, the growing influence of middle powers, efforts to counter U.S. hegemony, and strategies to circumvent sanctions. Though the future trajectory of this economic realignment remains uncertain, many developing nations are already reaping its benefits.
The concept of society has undergone radical transformations, from the Agricultural Revolution to the Industrial Revolution, eventually giving rise to the modern nation-state as defined by the Westphalian model. In their quest for power, nation-states strengthened their economies and militaries, laying the groundwork for global superpowers. Before the World Wars, the global order was multipolar, dominated by several powerful nations. However, the aftermath of these conflicts saw the emergence of two superpowers, the United States and the Soviet Union. The Cold War rivalry between them defined global politics until the Soviet Union’s dissolution in 1991 left the United States as the world’s sole superpower.
The end of the Cold War marked the ascendancy of the U.S. as the dominant global force, with many nations adopting its model of a free market economy. This created opportunities for several countries to develop their economies, allowing some to rise as influential players on the world stage.
China’s economic liberalization, initiated in 1978 under Deng Xiaoping, laid the foundation for its transformation into a global economic giant. Its accession to the World Trade Organization (WTO) in 2001 further accelerated its growth, with annual GDP increases exceeding 9% for decades. This economic boom lifted approximately 800 million people out of poverty and positioned China as a formidable challenger to U.S. economic dominance. China has overtaken the U.S. in several sectors, and experts predict it will become the world’s largest economy by 2030–2035. Its Belt and Road Initiative (BRI), a trillion-dollar infrastructure project, has expanded its economic and soft power across Asia, Africa, and Europe, reshaping global trade and connectivity.
Middle powers are playing an increasingly significant role in shaping the global order. As Maleeha Lodhi, a former Pakistani diplomat, noted, these nations, while not superpowers, exert substantial influence on international geopolitics. Countries like Germany, Japan, Canada, Brazil, India, South Africa, Turkey, Saudi Arabia, Singapore, and Indonesia have bolstered their economic, military, and diplomatic capabilities, enabling them to shape international relations effectively. Among these, economic strength is the primary tool through which middle powers influence global affairs. By forming strategic alliances and adopting innovative economic policies, these nations have positioned themselves as key players in the emerging multipolar world.
The U.S. has often relied on sanctions as a tool to enforce its foreign policy, targeting nations with differing political systems or policies. This approach has significantly impacted countries like Russia and Iran, as well as their trading partners. For instance, following Russia’s invasion of Ukraine, the U.S. and its NATO allies imposed sweeping sanctions to cripple Russia’s economy. Restrictions on Russia’s access to the SWIFT financial transaction system disrupted its trade with other nations. Similarly, Iran has faced decades of sanctions over its nuclear program, severely affecting its economy and international relations.
Sanctions also create challenges for third-party nations. Pakistan, for example, has faced hurdles in completing a gas pipeline project with Iran due to fears of U.S. sanctions. While Iran fulfilled its part of the agreement, Pakistan has been unable to proceed, highlighting the far-reaching implications of American economic policies.
The rise of economic blocs like BRICS and the SCO exemplifies the shift toward a multipolar global order. These alliances aim to counterbalance U.S. dominance by fostering economic cooperation and reducing reliance on Western-dominated systems.
Since its inception in 2009, BRICS has grown from five to eleven member states, with many more expressing interest in joining. Collectively, BRICS countries account for over 40% of the global population and approximately 37.3% of the world’s GDP based on purchasing power parity. The establishment of the BRICS New Development Bank in 2015 marked a significant step toward financial independence, providing funding for development projects in local currencies. More recently, discussions about introducing a common BRICS currency signal a bold move to reduce reliance on the U.S. dollar, potentially reshaping global financial systems.
The Shanghai Cooperation Organization also plays a pivotal role in fostering economic multipolarity. Beyond promoting regional connectivity, the SCO focuses on combating transnational terrorism and ensuring regional stability. By enhancing economic ties and reducing dependence on Western-dominated systems, the SCO has become a key player in the evolving global order.
The world is witnessing a gradual yet profound shift from unipolarity to multipolarity. The rise of China, the growing influence of middle powers, and the formation of economic blocs like BRICS and the SCO all challenge the dominance of the U.S.-led economic regime. These developments reflect a collective effort to enhance economic sovereignty and reduce vulnerability to sanctions and other forms of external pressure. As this transformation unfolds, many developing nations stand to benefit from increased opportunities for trade, investment, and regional cooperation. While the long-term implications of this shift remain uncertain, the current trajectory suggests a more balanced and inclusive global economic order.
The author is an International Relations graduate from the University of Sindh Jamshoro with a keen interest in global issues and strategic studies.
