China is poised to have more impact on the world over the next 20 years than any other country. If current trends
persist, by 2025 China will have the world’s second largest economy and will be a leading
military power. It also could be the largest importer of natural resources and the biggest polluter.
India probably will continue to enjoy relatively rapid economic growth and will strive for a
multipolar world in which New Delhi is one of the poles. China and India must decide the extent
to which they are willing and capable of playing increasing global roles and how each will relate
to the other. Russia has the potential to be richer, more powerful, and more self-assured in 2025
if it invests in human capital, expands and diversifies its economy, and integrates with global
markets. On the other hand, Russia could experience a significant decline if it fails to take these
steps and oil and gas prices remain in the $50-70 per barrel range. No other countries are
projected to rise to the level of China, India, or Russia, and none is likely to match their
individual global clout.
...
For the most part, China, India, and Russia are not following the Western liberal model for selfdevelopment
but instead are using a different model, “state capitalism.” State capitalism is a
loose term used to describe a system of economic management that gives a prominent role to the
state. Other rising powers—South Korea, Taiwan, and Singapore—also used state capitalism to
develop their economies. However, the impact of Russia, and particularly China, following this
path is potentially much greater owing to their size and approach to “democratization.” We
remain optimistic about the long-term prospects for greater democratization, even though
advances are likely to be slow and globalization is subjecting many recently democratized
countries to increasing social and economic pressures with the potential to undermine liberal
institutions.
Two Climate Change Winners
Russia has the potential to gain the most from
increasingly temperate weather. Russia has
vast untapped reserves of natural gas and oil
in Siberia and also offshore in the Arctic, and
warmer temperatures should make the
reserves considerably more accessible. This
would be a huge boon to the Russian
economy, as presently 80 percent of the
country’s exports and 32 percent of
government revenues derive from the
production of energy and raw materials. In
addition, the opening of an Arctic waterway
could provide economic and commercial
advantages. However, Russia could be hurt
by damaged infrastructure as the Arctic
tundra melts and will need new technology to
develop the region’s fossil energy.
Canada will be spared several serious North
American climate-related developments—
intense hurricanes and withering heat
waves—and climate change could open up
millions of square miles to development.
Access to the resource-rich Hudson Bay
would be improved, and being a circumpolar
power ringing a major portion of a warming
Arctic could be a geopolitical and economic
bonus. Additionally, agricultural growing
seasons will lengthen, net energy demand for
heating/cooling will likely drop, and forests
will expand somewhat into the tundra.
However, not all soil in Canada can take
advantage of the change in growing season,
and some forest products are already
experiencing damage due to changes in pest
infestation enabled by warmer climates.
