A New World Order: China’s Alternative to the Western Model

I was struck by the headline that has become the title of today’s reflection.

I quote:

“History has finally been made. The BRICS countries exceeded even the greatest expectations and took an enormous step towards multipolarity by expanding the group to BRICS 11. From 1 January 2024, Argentina, Egypt, Ethiopia, Iran, Saudi Arabia and the United Arab Emirates will join the five original BRICS members.”

Economic multipolarity means a shift in the centre of economic gravity. The rise of Asia and the Global South, for example, is changing their respective shares of global GDP, production and trade. The Western model must therefore be flawed if China is seeking an alternative to it.

Seventeen of the European Union’s 27 member states exceeded the limits for budget deficits and public debt last year. Unfortunately, Slovakia was among them, even though Czechoslovakia had not been indebted. The United States is also heavily indebted:

“The debt has been increasing at an average rate of approximately $59,362 per second.”

In other words, the debt is growing by an average of approximately $59,362 every second. Incredible!

China’s economic growth stands at 4.5 per cent.

Economics has a thorough understanding of how an economic system should operate and, above all, how its development should be secured. This can be expressed econometrically or graphically.

We can clearly see three fundamental functions of every economic system:

• the production of output, represented by Y or GDP;

• accumulation;

• the distribution of output.

These functions must be ensured by economic policy. In Czechoslovakia, we used input–output analysis for this purpose.

The diagram shows four sectors:

• households;

• government;

• enterprises;

• the foreign sector;

and the circulation of flows between them.

We can observe:

• household income and household expenditure;

• government revenue and government expenditure;

• enterprise revenue and enterprise expenditure;

• foreign-sector revenue and foreign-sector expenditure.

We do not need the Anglicism “cash flow”.

For example, the government has four types of revenue and two types of expenditure. All flows begin in the section to the right of the GDP rectangle. The accompanying text explains what they mean.

We can therefore trace the source of individual flows and their final destination, including wages. In the real economy, the connecting lines acquire different “thicknesses”. These must be optimised, which is the task of economic policy.

Unfortunately, after joining the European Union, we stopped doing this. The EU did not develop a methodology or a regional model. Perhaps such intellectual procedures were too sophisticated for it. Standards and moral principles were lacking. It was a demanding path full of obstacles.

China’s alternative to the Western model, as we shall see below, is different.

When we joined the EU, the European Commission did not explain, either graphically or verbally, how our financial flows would be incorporated into the flows of the older EU member states. It merely required us to complete the accession chapters, thereby discovering what wealth we possessed, which industries we had and which companies were successful.

Our negotiators did not demand such an explanation from the EU either. They lacked the necessary knowledge and simply obeyed.

As the quoted passage states:

“The BRICS countries exceeded even the greatest expectations and took an enormous step towards multipolarity by expanding the group to BRICS 11.”

The road leading to BRICS 11 was difficult and bumpy during the two days of discussions in Johannesburg, as Russian President Vladimir Putin acknowledged. But was the path towards the European Union not equally bumpy?

The final outcome of the BRICS summit proved to be a miracle of transcontinental inclusion. Western Asia was represented in full strength. The Arab world gained three full members, as did Africa. Brazil strategically lobbied for the inclusion of the troubled Argentina.

We experienced nothing comparable when joining the European Union.

As a consequence of the war, among other factors, the G7 has effectively found itself on a path of economic decline. The G20 faces similar problems. BRICS 11 is expected soon to become BRICS 20. This will undoubtedly affect the petrodollar as well.

“Even more than a geopolitical and geoeconomic breakthrough, however, BRICS 11 will achieve a genuine breakthrough in the field of energy. With the accession of Tehran, Riyadh and Abu Dhabi, BRICS 11 immediately becomes an oil and gas superpower which, according to InfoTEK, controls 39 per cent of global oil exports, 45.9 per cent of proven reserves and 47.6 per cent of all oil produced worldwide.”

These are serious economic facts. Are economic policymakers aware of them?

BRICS may have better economists than Slovakia or the European Commission.

Where Does the New World Order Begin?

The Russian–Chinese strategic negotiations in Johannesburg are of fundamental long-term importance. They have even determined the principal directions in which the participating economies will develop, particularly in oil and gas.

At the same time, BRICS is speaking about the need to reform the existing institutional framework, from the United Nations Security Council to the International Monetary Fund and the World Trade Organization.

The international rules-based order is therefore also collapsing. The rules were presumably not good. We experience this every day in the conduct of the United States.

Given the natural resources of Russia and China, a form of Russian–Chinese leadership is emerging.

BRICS opposes any form of hegemony. This means allowing the economic systems of individual countries to function according to their own economic policies, as illustrated by the diagram at the beginning of this article.

Precisely because we expect the emergence of a new world order, also as a consequence of the wars, we must recognise the importance of national economic policy.

Economic policy consists of a set of measures adopted by the state — has the European Union forgotten this, or does everything depend on its goodwill? — which are intended to influence the functioning of a national economy over a defined period.

The principal actor in economic policy is therefore the government, as shown in the diagram. The government is the executive body of state power.

Economic theory distinguishes between short-term and long-term objectives of economic policy. Today, however, short-term objectives are largely confined to employment, price stability and, of course, economic growth, which we do not derive from an appropriate economic model.

The available instruments are limited to monetary policy — itself restricted because it is controlled by the European Central Bank — fiscal policy, socioeconomic policy and foreign-trade policy.

After 1993, we implemented these policies only partially because the EU had assumed the decisive role. The national dimension could consequently be ignored. In other words, we ceased managing our own economy.

We do not even know what the European Union’s vision is.

We need a comprehensive set of economic instruments, including optimisation methods.

Today, we must also recognise the emergence of artificial intelligence. As AI becomes a major tool for predicting international events, I believe its increasingly visible shortcomings may result in serious geopolitical and economic problems.

Xenophon wrote the important work Oeconomicus. It was the first book on economics. How, then, could Greece go bankrupt? Perhaps through somebody’s deliberate actions.

The word “economics” originates from this term, which is derived from the ancient Greek words for household, oikos, and to manage, némein.

Do we manage our economy?

Does the European Union manage the economies of its member states?

Or do we have compulsory economies governed by commands such as: you may do this, but you must not do that?

This is why we cannot optimise the functioning of Slovakia’s economy.

Conclusion

The Western economic model is flawed, and Western countries are heavily indebted. A new world order is taking shape.

Economic multipolarity means a change in the centre of economic gravity, as demonstrated by the development of BRICS. The title of this reflection may seem provocative, but we must prepare for what it describes, because such changes await us after the wars have ended.

The world changed after the First World War, and it changed again after the Second World War.

Politicians must not ignore the economic groupings that are now emerging. BRICS has advanced furthest and has already defined its future direction.

What we lack is a comprehensive economic policy of our own. The condition of any economy can be understood through the diagram presented at the beginning of this reflection.

That system must be optimised econometrically.

Readers should examine the diagram carefully and observe where financial flows originate, where they are directed and where they ultimately end — unfortunately, sometimes even in Belize.

BRICS opposes every form of hegemony. This means allowing national economic systems to function according to their own economic policies.

The development of our economic system is constrained. Nevertheless, we must have a long-term perspective and a corresponding vision.

Does the European Union truly manage the economies of its member states?

The Maastricht criteria are flawed because they do not determine or reflect the level of economic development achieved by individual countries.

Having one’s own economy is not an act of grace bestowed by somebody else. We must improve and cultivate our economy. We must recognise its importance and value for the Slovak Republic and for its citizens.

We have no guardian ensuring the proper functioning of the European Union.

Professor Jaroslav Husár

Rohovce, 26 July 2026