Analysis: Invasion of Ukraine could usher in new order between West and East

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It’s on everyone’s mind. How does Vladimir Putin simply ignore phone calls and visits from representatives of the richest nations of the European Union and the United States and carry out a land, sea and air invasion of Ukraine, clearly premeditated by the enormous level of coordination?

For weeks, he has made it clear that he does not want to hand it over to NATO, opening up a flank for the installation of missiles on the Russian border. But it is also clear that his action has greater symbolism, due to the level of contempt he shows towards other heads of state.

There are indications that the West is weakening, and as there is no vacuum of power, the East is advancing through the gaps.

Putin shows signs that he has prepared himself for this more tense moment, including predicting the limits of economic sanctions on Russia, the main instrument of reaction. His apparent calm and security would come from the fact that most of the pieces in his warlike chess game are well positioned on another board, the commodity markets.

Even commanding an economy with less brilliance, the Russian government made bets on key products, and globalization tried to create small interdependencies, as difficult to untie as a thin chain knot. Some examples.

Russia has large reserves of coal and oil and is the world’s largest gas producer. It was often repeated that almost 40% of the gas consumed in Europe is Russian. It is now becoming clear that there are no alternative suppliers to match European demand.

On Tuesday (22), a statement from an industry executive in Qatar circulated among international agencies, warning that there is not enough LNG on the market, liquefied natural gas, to cover the possible cancellation of contracts between Europeans and Russians.

Many put money on the table to bet that the German retaliation, by suspending the license for the Nord Stream 2 pipeline, which will bring Russian gas to the country, does not last until the end of autumn.

Russia is also an important producer of barley, oats, rye and especially wheat, a staple food item. In recent years, it has become the world’s largest wheat exporter, and controls 20% of the global supply.

As analysts speak of Putin’s loss of prestige, prices for Russia’s main products are gaining in value. The price of a barrel of oil is already over US$ 100 and wheat is up 17% in a week.

Adding a little bit of Brazil to the discussion, it is necessary to remember that Russia is such an expressive manufacturer of manures and fertilizers that no less than 62% of Brazilian imports from that country are concentrated in these products. Another important slice of these items comes from Belarus, an ally in the Ukraine war. How to be without?

There is another issue. Despite major countries condemning the Ukraine offensive, China remains uncritical of Putin, with high-ranking members issuing dubious demonstrations.

Members of Chinese diplomacy have already weighed in on Russia’s relationship with Ukraine and the breakaway republics.

There’s no secret there. If China condemns Russia, it will complicate its demands on Taiwan. On Wednesday (23), the Chinese Foreign Minister even declared that Taiwan is not Ukraine because it has always been an inalienable part of China.

The two countries have been walking together in the economy for a while. Russia’s main trading partner — by far — is China, and vice versa. Ore and a giant volume of oil go to China, which sells a lot of machinery and electronics to Russia.

Between the two countries, pipeline networks are under construction that promise to change the balance of product supply in the global market.

In early February, when the Ukraine crisis was already under way, the partnership escalated. Putin went to Beijing to attend the opening of the Winter Olympics.

In a clear message to the West, especially the United States, he and Chinese President Xi Jinping announced a “no limits” agreement in the economic and political areas.

This approach consolidates the organization of a powerful bloc on the eastern side of the world, led by China, which is sidelining the western powers.

In the midst of the pandemic, in November 2020, while then-President Donald Trump was waging the trade war against China, the Asian giant and 14 Pacific countries closed the world’s largest trade deal. Called the Regional Comprehensive Economic Partnership, the bloc brings together 2.2 billion consumers and a third of global GDP.

At the same time, China continues to build the New Silk Road, a mega-project of infrastructure that links the Middle East, Asia, Africa and Europe, crossing areas that were under the influence of the former Soviet Union.

All these movements have placed the two countries, which were once the greatest empires in the east, with their backs to the west. Putin, in his invasion of Ukraine, made a bolder and newer move, he confronted the West — here, understood as the developed group of that part of the world, Europe and the United States.

Yes, everything indicates that the President of the United States, Joe Biden, may be right. There are signs that Putin is working to rebuild the former Soviet Union. And what does laconic China want?

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