"We are living in a time of uncertainty and unrest. This period will last anywhere from 5 to 10 years," President of Finland Alexander Stubb estimated at the 36th theme day of the OP Financial Group Research Foundation.
The assessment by President Stubb is based on his perception of current and future development of the global order, balance and dynamics.
According to President Stubb, the crucial date marking the change to the current shift in the world order was 24 February 2022, when Russia's aggressive war in Ukraine began.
"I would go as far to say that the period from 2022 to today is a similar turning point for our generation as the years 1918, 1945 or 1989 were for previous generations. It is a period when the global order and balance of power are reshaped in one form or another.
The year 1918 refers to the League of Nations, which was established after World War I to uphold peace in the world. In 1945, a new balance of power emerged in the world with the founding of the United Nations and the bipolar world of two superpowers, the United States and the Soviet Union. The end of the Cold War in 1989 and the unipolar hegemony of the United States marked another turning point.
"Today, we are living in a world dominated by struggles between great powers, power politics and the erosion of the international system. Right now, a struggle is being fought in the world system between multilateral, cooperative order – the world of yesterday – and multipolar, transactional disorder. Where before there were clear norms, institutions and rules, the same institutions, norms and rules are now being undermined."
Watch the entire speech by President Alexander Stubb (starts at 12:04). The recording also includes OP Financial Group President and Group CEO Timo Ritakallio's analysis of the geopolitical situation and awarding of the doctoral dissertation of the year.
Old and new global orders on collision course
According to President Stubb, the upheaval of institutions is also reflected in the global balance. The factors that influence the balance are the global West, East and South.
President Stubb described the global West and East as opposing powers. The global West seeks to maintain the world system based on institutions, norms and treaties. From the perspective of the global West, the United States will play a crucial role. What will the United States do – will it defend institutions, norms and rules?
The global East, which is led by China and supported by Russia, Iran and North Korea, believes that the world needs a new order that is no longer dominated by Western countries. Power is achieved through cooperation that is heavily dependent on cheap energy and infrastructure projects.
"Today, China is the largest creditor for 120 countries. This has resulted in transactional relationships, where values hold little sway."
President Stubb made the argument that due to the struggle between West and East, the balance of the world system is decided by the global South, which is not dependent on the West but is seeking its own direction.
Competition can lead to conflict
According to President Stubb, the factors influencing the dynamics of the world system are competition, conflict and cooperation. By competition, the President referred to both geopolitical and technological competition as well as competition in the energy sector.
"Competition has become more fierce and is no longer strictly economic in nature. If competition is not regulated in terms of the use of AI, for example, it can result in some form of conflict. The conflict is what worries me. It can take the form of a local, regional or global conflict."
President Stubb described the current state of the world as a period of transition and unrest.
"Cooperation is necessary to prevent competition from escalating into conflict. We need to get back on the path of cooperation. I believe we can do that. None of the important global challenges can be solved by one country alone, whether climate change, technology, energy, sustainable development, economic growth or demographic changes. They cannot be solved without cooperation."
Geopolitics also challenge OP Financial Group
Geopolitical and global economic uncertainty also impact OP Financial Group. They are one of the most important forces for changefor which OP Financial Group should be prepared.
In addition to geopolitical and global economic uncertainty, forces of change that impact OP Financial Group include polarisation and demographic changes, sustainable developmentand responsibility, artificial intelligence andthe power of data and shift of business value chains.