Anything you create on your own using your own
imagination or innovating an existing one to be more modern and useful is
referred to as creative matter. Geoeconomics is not an exception as the use of
economic tools to advance objectives it requires lot of imagination and/or
innovation. Here are few examples.
Let me start the first technique with Deng Xiaoping
the paramount leader of the People's Republic of China (PRC) during December
1978 to November 1989 who understood how to be creative. The transformation of
a planned economy to market based one started from a vantage point. First achieve self-sufficiency
in basic needs then to upgrade to the luxury ones and thereafter look for new
markets to avoid stagnancy on one hand and market saturation on the
other. Yet this exercise must be done keeping the masses happy and contended so
that rebellious tendency is suppressed and diverted to innovation resulting in more
disruptive technology.
Second creative technique is ‘alternate market business model’ perfected by Vladimir Putin in the wake of economic sanctions imposed by the West after his Special Military Operations in Ukraine. It took up less than three months for Russia to corral in China, India, Turkey and South Africa to receive Russian products including energy, food and military items at competitive prices discount to the market.
Third one relates to dismantling entire factory brick by brick and transport lock and barrel to a faraway country to take advantage of selling price, wages & salaries and cost of production prevailing therein with twin geoeconomics purpose of having additional revenue and making the recipient country docile and beholden to the originator. Although this technique was ‘made in America’ in 1970s China followed suit in the last two decades via BRI and recently Russia facing wrath of the West transferred entire manufacturing set-up to Iran, North Korea and to the African continent. Rumours galore that China and Turkey are the newer recipients.
Fourth and fabulous one is the use of arms race as creative geoeconomics. Once again the credit goes to USA who pioneered this geoeconomics tool at the end of WWII where she fought Soviet Union tooth and nail and bankrupted the latter by developing cutting edge military hardware and munitions. Now it was bay back time for Putin’s Russia. After developing and show-casing hypersonic missiles such as Zircon, Avangard and Kinzhal in the Ukraine theatre. Russia is forcing USA to respond in kind in terms of defence and counter attack. You know what? America has to cough up with multi-trillion dollars to reach parallel to the Russian position. Assuming it takes quite a number of years Russia, China and now Iran would have developed much more potent arsenals. To sum up creative geoeconomics originally invented by America is coming back home to roost!
Cheers!
Muthu Ashraff Rajulu
Business Strategist
Mobile: + 94 777 265677
E-mail: cosmicgems@gmail.com
Blog: Business Strategist
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