Cooperation on Control Points is needed for strategic autonomy: rising tensions in the Indo-pacific present new challenges for policymakers worldwide
report
Decades of globalization have lowered the costs of doing business and created interconnected economies with mutual interests towards further globalization. Companies increased their profits by outsourcing manufacturing to lower-cost countries, which in turn contributed to the rapid industrialization of those countries. Over the past several decades we have seen the rise of the Asian Tigers, and China’s entry into the World Trade Organization (WTO) and becoming the world’s manufacturing hub. This led to a complex web of supply chains among the globe’s economic production networks.
Today, the world faces geopolitical and geo-economic challenges. During the Covid- 19 crisis, for instance, vulnerabilities in global production and supply chains were brought to light, showing some shocks could spread rapidly to other countries in the globalized system.35 When the Ever Given was stuck in the Suez Canal, a single ship blocked a straight through which 12% of world trade flows.36 This resulted in delays for companies and consumers in products as diverse as oil and gas to auto parts and clothing.37 However, the risks and uncertainties in the center of many of the world’s value chains have further increased with rising geopolitical tensions, putting global value chains and technological dependencies under greater scrutiny and increasing neo-mercantilist concerns. This poses significant geo-economic risks. Thus, an important question is: How can countries ensure their strategic autonomy goals and objectives, and with whom can they do so? The Netherlands and the Republic of Korea are two countries that can be characterized as open economies that rely on imports from abroad for many of the products they need. For instance, for the Republic of Korea foreign trade accounted for 97% of its economy in 2022,39 while for the Netherlands this was 184% in the same year.40 Such openness is not inherently problematic, but dependencies will need to be robust and reciprocal. That is, when these dependencies aremarked by one-sided dominance, a lack of alternatives, or political influence, they become risky and can quickly turn into vulnerabilities that affect strategic autonomy. “Open” strategic autonomy thus reflects the aspiration to combine openness with strategic caution, emphasizing cooperation where possible and strategic restraint where necessary, in line with the guiding principle: “as open as possible, as closed as necessary”.42 While high-level policy goals for Open Strategic Autonomy (OSA) thus dom
While high-level policy goals for Open Strategic Autonomy (OSA) thus dominate current geopolitical and geo-economic debates, actionable strategic diagnostics are needed to support OSA policymaking in countries such as the Netherlands or the Republic of Korea. This brief therefore offers an analytical, operational, measurable and comparative way to approach OSA by introducing the Control Points framework. Control Points refer to valuable and unique strategic positions within global value chains, production networks and RD&I systems where influence is concentrated and dependencies can be governed.43 This framework has been developed to help policymakers systematically address power relations in value chains and improve its ‘open strategic autonomy.
Today, the world faces geopolitical and geo-economic challenges. During the Covid- 19 crisis, for instance, vulnerabilities in global production and supply chains were brought to light, showing some shocks could spread rapidly to other countries in the globalized system.35 When the Ever Given was stuck in the Suez Canal, a single ship blocked a straight through which 12% of world trade flows.36 This resulted in delays for companies and consumers in products as diverse as oil and gas to auto parts and clothing.37 However, the risks and uncertainties in the center of many of the world’s value chains have further increased with rising geopolitical tensions, putting global value chains and technological dependencies under greater scrutiny and increasing neo-mercantilist concerns. This poses significant geo-economic risks. Thus, an important question is: How can countries ensure their strategic autonomy goals and objectives, and with whom can they do so? The Netherlands and the Republic of Korea are two countries that can be characterized as open economies that rely on imports from abroad for many of the products they need. For instance, for the Republic of Korea foreign trade accounted for 97% of its economy in 2022,39 while for the Netherlands this was 184% in the same year.40 Such openness is not inherently problematic, but dependencies will need to be robust and reciprocal. That is, when these dependencies aremarked by one-sided dominance, a lack of alternatives, or political influence, they become risky and can quickly turn into vulnerabilities that affect strategic autonomy. “Open” strategic autonomy thus reflects the aspiration to combine openness with strategic caution, emphasizing cooperation where possible and strategic restraint where necessary, in line with the guiding principle: “as open as possible, as closed as necessary”.42 While high-level policy goals for Open Strategic Autonomy (OSA) thus dom
While high-level policy goals for Open Strategic Autonomy (OSA) thus dominate current geopolitical and geo-economic debates, actionable strategic diagnostics are needed to support OSA policymaking in countries such as the Netherlands or the Republic of Korea. This brief therefore offers an analytical, operational, measurable and comparative way to approach OSA by introducing the Control Points framework. Control Points refer to valuable and unique strategic positions within global value chains, production networks and RD&I systems where influence is concentrated and dependencies can be governed.43 This framework has been developed to help policymakers systematically address power relations in value chains and improve its ‘open strategic autonomy.
Topics
TNO Identifier
1023511
Publisher
TNO Vector
Collation
11 p.