In his annual State of the Union speech, US President Joseph Biden addressed concerns about his age and physical prowess and called for continued support for Ukraine [fe62bcc4]. Meanwhile, Russian President Vladimir Putin was re-elected with 88% of the vote [fe62bcc4]. The global order is currently characterized by disunion and polarization, with the price of gold reaching an all-time high [fe62bcc4]. The US economy is growing faster than the rest of the world, but is sustained by growing fiscal and trade deficits [fe62bcc4]. The European economy is also facing challenges due to the conflict in Ukraine [fe62bcc4]. Tensions between the US and China are expected to continue, with both countries competing in the technology race [fe62bcc4]. The US leads in high-tech, while China excels in mid-tech and production prowess [fe62bcc4]. The global contest ultimately hinges on who can convert AI technology into overall productivity [fe62bcc4]. This technology race is part of a larger struggle for hegemony between the US and China [fe62bcc4].
US President Joe Biden is at risk of losing the young Black-Hispanic vote due to his stance on the Israel-Palestine conflict [fe62bcc4]. The Republican Party is also experiencing a dramatic political dynamic, and former US President Donald Trump has been arrested in an election fraud case [fe62bcc4].
According to a recent analysis by The Globe and Mail, the deglobalization trend, which began during Donald Trump's presidency, is expected to continue regardless of the outcome of the US presidential election [89b93c27]. This trend is characterized by lower trade barriers, which will dampen economic growth and negatively impact equity markets [89b93c27]. Smaller and more open economies, such as Canada, will struggle in this new environment [89b93c27]. However, the US, with its large market size and low trade-to-GDP ratio, is expected to benefit from deglobalization [89b93c27]. On the other hand, China will be negatively affected [89b93c27].
The impact of deglobalization on economic hegemony and technological competition is significant. It is expected to result in lower economic growth, higher price pressures, and higher interest rates [89b93c27]. Bonds are expected to perform well in this environment [89b93c27]. Small-cap funds and commodities are also expected to benefit from deglobalization [89b93c27]. Industrial real estate investment trusts and consumer staples are likely to see positive effects as well [89b93c27].
Competition and relationships within the digital economy present various phenomena in international relations, such as the mutual technology blockades between the United States (US) and China, the implementation of the Digital Services Act (DSA) and Digital Markets Act (DMA) across the European Union (EU) with global impacts, global trade regulations through the WTO E-commerce Joint Statement Initiative (JSI), and the Regional Comprehensive Economic Partnership (RCEP) [4fa0c6d8]. The digital economy has revolutionized conventional patterns of economic activity in various countries. The globalization of the digital economy means that technology is no longer confined by national borders, companies can operate globally, and innovations can spread rapidly [4fa0c6d8]. The World Economic Forum (WEF) report identifies seven countries, namely Finland, Switzerland, Sweden, Israel, Singapore, the Netherlands, and the United States, which are at the forefront of enjoying the positive impacts of economic investments in information and communication technology (ICT). Major technology companies like Google, Apple, Facebook, Amazon, and Microsoft (GAFAM) in the US, as well as Alibaba, Huawei, Tencent, WeChat, ZTE, and Baidu in China, become key players in the global digital economy and achieve dominant market positions. The technology trade war between the US and China is a clear example of how competition in the digital economy can trigger international conflicts [4fa0c6d8]. Digital economic competition encompasses several interconnected aspects that can create inequality and disharmony, including the digital divide and political tensions. However, competition in the digital economy also drives cooperation and strategic alliances. Digital diplomacy has become a strategic instrument in international relations as it enables cooperation to address global challenges. Countries can leverage digital diplomacy to shape international frameworks, such as through participation in the G20. International cooperation is also important in supporting the circular digital economy, ensuring that the digital economy is environmentally friendly and promotes green technologies. Competition in the digital economy has become a crucial element in international relations. Technological transformations and the social constructions built around technology not only change the way we do business and communicate but also affect global power dynamics, national security, and economic well-being. Countries need to develop fair regulatory policies capable of fostering innovation and investment to compete in the digital economy era. Various impacts and influences arising from competition in the digital economy need to be addressed so as not to hinder technological development for other countries. Digital diplomacy and international cooperation offer new ways to influence international relations and promote national interests. Countries that can manage this competition wisely will be able to leverage the digital economy to drive growth and prosperity while maintaining international security and stability [4fa0c6d8] [89b93c27] [fe62bcc4].