Globalization has its days numbered and the current times will be decisive for the future development of society, according to Larry Fink, CEO of BlackRock Inc (NYSE:BLK), and Howard Marks, CEO of Oaktree Capital Group LLC (NYSE:OAK-A).
New World Order
“The Russian invasion has put an end to the globalization that we have experienced in the last three decades,” the BlackRock CEO said. Meanwhile, for Marks, the war has given countries a glimpse of how dependent they have become on others.
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The greatest example is Europe's extreme dependence on Russian gas, they argue —one of the key assets in the sanction package the West has imposed on Moscow— and Russia’s “blackmail tactics.”
According to the experts, the war in Eastern Europe is only the most recent scenario of reconfiguration of global order.
Two years ago, at the onset of the pandemic, companies and countries had to adapt to depend less on China, while Brexit also set a similar tone. The rise of Donald Trump in the U.S. and the financial crisis of 2008 were also crucial events in a new trend.
Events
In a sociopolitical sphere, the commodification of relationships has been taking place, increasing problems that have been emerging since approximately the 1970s.
In this regard, there are three points that mark the starting point of post-globalization, as a consequence of the war in Europe.
Commercial interdependence is the best way to avoid wars. It is observed that Europe was built that way, but today Europe is seeking greater energy independence from Russia, Fink explains.
A second issue is that the non-aggression pact between the big five of the United Nations Security Council was altered.
Such a disagreement, between Russia and the U.S., had never existed in the history of globalization. Also, there is a return to nationalistic sentiments as Germany, for instance, is allocating resources to defense.
These events are not leading to deglobalization, but rather are laying the foundations for a new world order - a polycentric one that creates alliances according to the interests of the moment, between different countries.
