In Geopolitics Today: Wednesday, December 6th
Italy Formally Withdraws from China's Belt and Road Initiative, Venezuela Escalates Border Row, and other stories.
Italy Formally Withdraws from China's Belt and Road Initiative
Italy has formally withdrawn from China's Belt and Road Initiative (BRI), declining to renew its participation in Beijing's global infrastructure scheme when the agreement expires in March. Prime Minister Giorgia Meloni had criticized the 2019 decision to join the BRI under a previous government as a “mistake.”
Italy was the only G7 member to sign on to the trillion-dollar program establishing trade and transport links akin to the ancient Silk Road. But Rome reassessed ties amid meagre economic gains and unease about China exploiting its foothold for political influence. Officials insist the exit won't compromise bilateral relations or Italian companies. Still, it signifies hardening attitudes among Western powers toward China's geopolitical ambitions even as most seek to maintain complex economic partnerships.
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America's Vast Power Over Global Finance and Data
The US dollar's primacy in banking and US control of undersea internet cables afford Washington unprecedented power to monitor overseas transactions and punish those it disfavours. The capacity to halt flows of finance or data grants the US unmatched abilities to impose economic pain, even on firms with no direct ties.
However, the system's very potency risks overextending American power across the globe. Endless coercion of innocent foreign companies could spur mass adoption of alternative currencies. And nuclear-armed adversaries like China might opt to sever global economic ties rather than endure perpetual strangulation. Domestically, the surveillance apparatus' unchecked reach enables spying on populations worldwide while jeopardizing citizens' own privacy.
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NATO Pledges Naval Aid for Ukraine's Grain Export Corridor
Ukraine has secured commitments from its NATO partners to provide additional air defences and smaller naval vessels to bolster security for grain shipments traversing its southern export corridor. President Zelenskyy announced the aid, including combat boats, during a recent forum highlighting the initiative's importance amid “various challenges” since Russia's withdrawal.
The grain deal has enabled significant food exports despite ongoing war risks. But some argue the corridor requires further layered protections, given real missile and drone attack threats from Russian forces. While Ukraine considers deploying donated patrol and coastal craft, more patrol boats with anti-ship capabilities would allow a mosquito fleet strategy that would drastically constrain Russia's navy. Full implementation of already promised Western equipment, like UK missile boats, is still pending, but forms a key part of NATO-supported efforts to uphold the grain agreement without Moscow's participation.
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Myanmar Rebels Gain Strategic Upper Hand
Recent victories by Myanmar's ethnic insurgents have strategically shifted the country's civil war, challenging the military junta's grip on power. The scale of recent territorial losses exposes the thin spread of junta forces and their inability to exert control nationwide, despite bluster and superior weaponry.
With Tatmadaw ranks depleted by desertions and deaths, rebel alliances now match or exceed the government's frontline strength. Despite plans for a counter-campaign, huge manpower shortfalls prevent concerted operations on all fronts. While cohesion persists so far, the generals may have to cede peripheral lands to confront the existential crisis. With both sides committed to total victory, the conflict looks set for greater violence ahead. But rebel momentum shows Myanmar's augured collapse cannot be dismissed.
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Venezuela Escalates Border Row
Venezuelan President Nicolas Maduro dramatically escalated his country's long-standing border dispute with Guyana this week by announcing plans to incorporate the contested Essequibo region after a referendum rejecting international arbitration.
Maduro ordered state oil and mining firms to immediately secure exploitation licences in the mineral-rich area that constitutes two-thirds of Guyana. Caracas also declared it will establish a new military division nearby, even as the UN and regional leaders urged restraint. But any Venezuelan actions to forcibly annex Essequibo territory would likely spur Guyana to request outside assistance under collective self-defence measures.
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Nepal a Focal Point in China-India Hydropower Competition
Nepal has become a focal point of intensifying geopolitical competition between China and India due to its immense, yet largely untapped hydropower potential. Both Asian giants view controlling the mountainous nation's rivers as a strategic priority amid their own rivalry.
However, political instability, bureaucratic dysfunction, and underdeveloped infrastructure prevent Nepal from harnessing its estimated 42,000 megawatts capacity. India is consolidating influence via imports and dam contracts, while blocking deals with Chinese firms. But an inconsistent strategy risks antagonizing Nepal and inflaming tensions. As great power manoeuvring accelerates, the US is closely monitoring events in the strategically significant Himalayan region.