Cairo

Source: Al Wafd Newspaper

Dr.. Ali Mohamed Al-Khouri

The conflict in Ukraine, which arose due to the Russian military operation in February 2022, has sparked strong economic reverberations around the world, deepened existing crises, and may and most likely pave the way towards a new multipolar world order. The economic fallout from the war, prompted by tough US sanctions on Russia, has caused a global recession that could last for many years, revealing an undercurrent of deep rooted issues within the capitalist world order.

The disintegration of the capitalist world system

The Russian military conflict in Ukraine prompted the United States and Europe to impose severe economic sanctions aimed at crippling the Russian economy. These sanctions notably restricted imports of oil, gas and coal from Russia, which in turn severely damaged global supply chains and led to a runaway rise in world prices. These events also revealed the capitalist world’s lack of economic stability and the existence of a latent economic crisis within it, which seems to be the result of gradual exacerbations over the past years, and may now be on the pace of explosion and lead to a new wave of bankruptcy, unemployment, poverty and crime all over the world.

repercussions of the conflict

The economic effects of this conflict are multifaceted and wide-ranging, extending beyond the primary stakeholders. Disruptions in energy supplies, soaring food prices, and banking crises are a prominent by-product of this geopolitical struggle. Moreover, the war and the escalation of international tensions deepened the wounds of the global economy and led to an unprecedented increase in transportation costs and service fees, and consequently to uncertainty and economic balance and the exacerbation of crisis conditions at the global level.

The emergence of a new global paradigm

The events reveal signs of a possible shift in the global political paradigm, signaling the emergence of a new multipolar world order. This is evidenced by what we see in the growing cooperation between Russia and China, the pursuit of leadership roles within the European Union by France, Germany and Italy after Britain leaves the European Union, and the trend observed in the rich African and Arab countries to develop independent energy policies. These changes have been reinforced by the rise of the Asian Infrastructure Fund, led by Russia and China, which rivals the influence of the World Bank.

Opportunities for the Middle East and the Arab region

While the acute global conflict indicates an unstable economic future, it offers the Middle East and the Arab region unique opportunities. In a multipolar world, countries such as the United Arab Emirates, Saudi Arabia, Egypt, Turkey and Iran can gain significant influence through strategic locations, energy reserves and global sea lanes. This transition – from a unipolar system to a multipolar system – may lead to less international interference in regional affairs, which will allow these states to exercise greater political and economic independence.

Shaping the future amid global conflict

The Ukrainian conflict and the global economic crises are already reshaping the world in many ways. As we prepare for the emergence of a new multipolar world order, policymakers must focus on mitigating the economic fallout through clear national strategic visions in this changing landscape.

Despite the bleak economic outlook resulting from escalating tensions between the great powers, the Middle East and the Arab region can benefit from any possible shift towards a multipolar world order. Key to this will be the region’s ability to maintain a balanced relationship with the great powers, prioritizing mutual benefit, political and economic independence, and forward-thinking development strategies.