The Geopolitical Reordering of the World - What Role Do Germany and Europe Play?

Who Has the Power? The War in Ukraine Turns the Original World Order Upside Down.

Russia's attack on Ukraine is turning the security and defense architecture of Germany and Europe upside down. It has also upset the previously held global balance of power between the U.S., China/Asia, Europe and Russia. In the coming years, we will have to struggle for a new world order. This struggle will make many poorer, because functioning value chains, economic potential and the pursuit of prosperity will recede into the background, while power interests will be of central importance.

• To what extent is geopolitics replacing geoeconomics?
• And what role do Germany and Europe play?

These and other questions have been discussed at the Munich Economic Debate with Dr. Claudia Major, Head of the Security Policy Research Group, Science and Policy Foundation.

General Information on the Presentation

The event was part of the series "Economic Consequences of the Russian Invasion of Ukraine".

The war in Ukraine is a geopolitical watershed. The world could disintegrate into an American-dominated bloc and a Chinese-dominated bloc. The war fundamentally changes the outlook for security and prosperity. There is a threat of stagflation, a combination of weak growth and high inflation. How should policymakers respond? Monetary policy faces a dilemma: Raising interest rates can curb inflation but would further dampen growth. Fiscal policy can only redistribute the burden of rising prices; it cannot eliminate it. In terms of energy policy, diversification of energy imports leads to greater security of supply, but also higher costs. In addition, military spending is rising.

• What consequences does the war have for Germany as a location for energy-intensive industries?
• In which policy fields and in which measures should the scarce resources flow?
• And what role does the EU play?