Russia in Global Affairs

The EU has encountered an unforeseen deformation of market mechanisms. While the EU is rethinking what has happened and working on a new strategy for economic development, Russia is returning to the “good old” practices that imitate democratic institutions and market mechanisms.

The EU’s biggest problem today is the loss of the European idea and the vagueness of European self-identity. Despite the ongoing process of enlargement, EU leaders have been unable to persuasively answer the question of what it means to be a European today.

The tools available to the world community to try to resolve the currency dispute between the United States and China are very limited. Under a favorable scenario the conflict will remain latent, and under the worst-case scenario it will result in the overall growth of protectionism. Much will depend on how well Western countries can reduce the level of public debt. At the second turn of the debt crisis it will go geopolitical.

The crisis is setting an almost impossible task before the countries with developing markets – to modernize market mechanisms and strengthen the state’s position in the economy, although their economic system is deformed a priori and international practice and standards ignore the fact of this deformation.

European integration is usually compared to a train moving toward a single destination that is known to all of its passengers. Today, however, there is a metaphor that more aptly describes European integration: a hypermarket with numerous shops, cafes, Internet outlets, beauty parlors, Laundromats, and multiplex cinemas.

The disintegration of the CIS, or its lingering in a state of latent disintegration will drastically reduce the potential of the countries in the region – as well as the international community – to control various processes there. Neither the EU nor the U.S. will be able to impose their system of governance in the CIS territory.

Over the next ten to 15 years the dollar’s global hegemony will be a thing of the past. The core of the new international system will be constituted by 20-30 of the most important currencies, which will be integrated into a real-time settlements system based on new information technologies. This type of format change can radically improve the position of the Russian ruble and alter guidelines for a national monetary policy.