NATO’s evolution and preparedness for future challenges rest upon the innovative strategies spearheaded by NATO’s strategic warfare development command, Allied Command Transformation. Tasked with steering the Alliance’s modernization and development, the Command’s role is pivotal in shaping NATO’s strategic policies and conceptual frameworks. Central to this effort is the NATO Warfighting Capstone Concept, which sets a 20-year vision for the Alliance.
The NATO Warfighting Capstone Concept serves as a roadmap, driving NATO’s endeavours to innovate, adapt, and strengthen its forces, capabilities, and plans. It contributes to the Alliance’s efforts to reinforce its deterrence and defence posture and offers a vision in support of maintaining and further developing NATO’s decisive military advantage by continuously adapting the military instrument of power.
Defining what the operating environments of the future will look like is a key outcome of Allied Command Transformation’s Strategic Foresight work; an activity that is accomplished in close collaboration with allies to ensure a fully realized picture is generated. The future operating environment provides the conditions to which NATO needs to adapt the military instrument of power.
The Strategic Foresight Analysis 2023 updates assumptions and extends the focus of the previous Strategic Foresight Analysis 2017 to assess the major drivers and most relevant implications of the Alliance`s Evolving Security Environment until 2043. The investigation delves deep into the evolving security environment, evaluating what major factors and implications are driving change.
This series of articles will explain each of the drivers for the Strategic Foresight Analysis 2023.
Geoeconomic Trends Shaping the Future Global Landscape
Economic dynamics are undergoing a seismic shift, with global activity gravitating towards Asia. Established economic systems are in flux, influenced by security concerns, digital transformation, and evolving manufacturing and production innovations. Pervasive competition amidst major global changes is fostering an increased polarization, where states and the private sector grapple with the challenges of global decoupling.
Over the next two decades, key geoeconomic trends will mold the global stage. The erosion of the Rules-Based International Order, heightened geopolitical rivalries, trade re-shoring, technological competition, and economic interests are set to drive regionalization and the formation of geoeconomic blocs. This transformation is anticipated to weaken globalization, slow economic growth, and alter the landscape of innovation.
Assertive powers will strive to internationalize currencies, challenging the dominance of the U.S. dollar. Major strategic competitors will push for norms and technological standards that diverge from western standards. Developing countries may align their financial systems with key allies, leading to a bifurcated economic order. The world is witnessing the emergence of geoeconomic blocs that intensify polarization, driven by security concerns and a desire to reduce reliance on supply chains from autocratic countries.
China, aiming for self-reliance, seeks independence in critical areas. Other states with regional influence may follow suit, contributing to the fragmentation of the global economic system. However, challenges such as economic interests and market influence pose hurdles to complete decoupling. The securitization of economics reflects shifting behaviours in response to strategic shocks.
Global economic activity is tilting towards Asia, a trend observed over the past two decades. The share of Asian countries in the global economic system is poised to increase further, while European Allies’ global consumption is expected to shrink. The Fourth Industrial Revolution, marked by the fusion of digital and physical systems, presents opportunities and challenges, driving regionalized economies and securitized supply chains.
New achievements of the Fourth Industrial Revolution, including additive manufacturing, smart agriculture, space technology, and digital transformation, will be pivotal in shaping wealth and economic power. Automation, driven by technology and demographics, will impact high- and middle-income countries, potentially limiting economic output and innovation. The resulting need for skilled workforces may drive legal migration, creating mixed effects for both origin and destination countries.
In NATO’s neighbourhood, population growth in low-income states will continue, accompanied by challenges posed by climate change and instabilities. Illegal migration, fuelled by these factors, will be a major source of demographic shifts and pose challenges for developed states. Rising national debts and stagflation may limit states’ abilities to drive digital and industrial transformation, affecting education, welfare, and climate resilience.
Technology developments and pervasive competition will shape the emergence of geoeconomic blocs and self-reliant regional ecosystems. This trend may weaken globalization, diverge technological standards, and prompt developing countries to align with key allies. Potential strategic shocks include major supply chain disruptions, export bans on critical resources, disruptive strikes against global systems, and the emergence of alternative financial systems.