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Appendix

Four Alternative Global Futures

In September-October 1999, the NIC initiated work on Global Trends 2015 by cosponsoring with Department of State/INR and CIA's Global Futures Project two unclassified workshops on Alternative Global Futures: 2000-2015. The workshops brought together several dozen government and nongovernment specialists in a wide range of fields.

The first workshop identified major factors and events that would drive global change through 2015. It focused on demography, natural resources, science and technology, the global economy, governance, social/cultural identities, and conflict and identified main trends and regional variations. These analyses became the basis for subsequent elaboration in Global Trends 2015.

The second workshop developed four alternative global futures in which these drivers would interact in different ways through 2015. Each scenario was intended to construct a plausible, policy-relevant story of how this future might evolve: highlighting key uncertainties, discontinuities, and unlikely or "wild card" events, and identifying important policy and intelligence challenges.

Scenario One: Inclusive Globalization:
A virtuous circle develops among technology, economic growth, demographic factors, and effective governance, which enables a majority of the world's people to benefit from globalization. Technological development and diffusion—in some cases triggered by severe environmental or health crises—are utilized to grapple effectively with some problems of the developing world. Robust global economic growth—spurred by a strong policy consensus on economic liberalization—diffuses wealth widely and mitigates many demographic and resource problems. Governance is effective at both the national and international levels. In many countries, the state's role shrinks, as its functions are privatized or performed by public-private partnerships, while global cooperation intensifies on many issues through a variety of international arrangements. Conflict is minimal within and among states benefiting from globalization. A minority of the world's people—in Sub-Saharan Africa, the Middle East, Central and South Asia, and the Andean region—do not benefit from these positive changes, and internal conflicts persist in and around those countries left behind.

Scenario Two: Pernicious Globalization
Global elites thrive, but the majority of the world's population fails to benefit from globalization. Population growth and resource scarcities place heavy burdens on many developing countries, and migration becomes a major source of interstate tension. Technologies not only fail to address the problems of developing countries but also are exploited by negative and illicit networks and incorporated into destabilizing weapons. The global economy splits into three: growth continues in developed countries; many developing countries experience low or negative per capita growth, resulting in a growing gap with the developed world; and the illicit economy grows dramatically. Governance and political leadership are weak at both the national and international levels. Internal conflicts increase, fueled by frustrated expectations, inequities, and heightened communal tensions; WMD proliferate and are used in at least one internal conflict.

Scenario Three: Regional Competition
Regional identities sharpen in Europe, Asia, and the Americas, driven by growing political resistance in Europe and East Asia to US global preponderance and US-driven globalization and each region's increasing preoccupation with its own economic and political priorities. There is an uneven diffusion of technologies, reflecting differing regional concepts of intellectual property and attitudes towards biotechnology. Regional economic integration in trade and finance increases, resulting in both fairly high levels of economic growth and rising regional competition. Both the state and institutions of regional governance thrive in major developed and emerging market countries, as governments recognize the need to resolve pressing regional problems and shift responsibilities from global to regional institutions. Given the preoccupation of the three major regions with their own concerns, countries outside these regions in Sub-Saharan Africa, the Middle East, and Central and South Asia have few places to turn for resources or political support. Military conflict among and within the three major regions does not materialize, but internal conflicts increase in and around other countries left behind.

Scenario Four: Post-Polar World
US domestic preoccupation increases as the US economy slows, then stagnates. Economic and political tensions with Europe grow, the US-European alliance deteriorates as the United States withdraws its troops, and Europe turns inward, relying on its own regional institutions. At the same time, national governance crises create instability in Latin America, particularly in Colombia, Cuba, Mexico, and Panama, forcing the United States to concentrate on the region. Indonesia also faces internal crisis and risks disintegration, prompting China to provide the bulk of an ad hoc peacekeeping force. Otherwise, Asia is generally prosperous and stable, permitting the United States to focus elsewhere. Korea's normalization and de facto unification proceed, China and Japan provide the bulk of external financial support for Korean unification, and the United States begins withdrawing its troops from Korea and Japan. Over time, these geostrategic shifts ignite longstanding national rivalries among the Asian powers, triggering increased military preparations and hitherto dormant or covert WMD programs. Regional and global institutions prove irrelevant to the evolving conflict situation in Asia, as China issues an ultimatum to Japan to dismantle its nuclear program and Japan—invoking its bilateral treaty with the US—calls for US reengagement in Asia under adverse circumstances at the brink of a major war. Given the priorities of Asia, the Americas, and Europe, countries outside these regions are marginalized, with virtually no sources of political or financial support.

Generalizations Across the Scenarios
The four scenarios can be grouped in two pairs: the first pair contrasting the "positive" and "negative" effects of globalization; the second pair contrasting intensely competitive but not conflictual regionalism and the descent into regional military conflict.

* In all but the first scenario, globalization does not create widespread global cooperation. Rather, in the second scenario, globalization's negative effects promote extensive dislocation and conflict, while in the third and fourth, they spur regionalism.
* In all four scenarios, countries negatively affected by population growth, resource scarcities and bad governance, fail to benefit from globalization, are prone to internal conflicts, and risk state failure.
* In all four scenarios, the effectiveness of national, regional, and international governance and at least moderate but steady economic growth are crucial.
* In all four scenarios, US global influence wanes.

European Union Members and Aspirants

Europe
Regional Trends. Most of Europe in 2015 will be relatively peaceful and wealthy. Its residents will do extensive business with the rest of the world but politically will be more inward-looking than the citizens of Europe in 2000. Looking out to 2015, Europe's agenda will be to put in place the final components of EU integration; to take advantage of globalization; to sustain a strong IT and S&T base to tackle changing demographics; and to wean the Balkans away from virulent nationalism.

EU enlargement, institutional reform, and a common foreign, security and defense policy will play out over the next 15 years, so that by 2015 the final contours of the "European project" are likely to be firmly set. Having absorbed at least 10 new members, the European Union will have achieved its geographic and institutional limits.

* As a consequence of long delays in gaining EU entry (and the after-effects of actual membership), leaders in some Central/Eastern Europe countries will be susceptible to pressures from authoritarian, nationalist forces on both the left and right. These forces will capitalize on public resentment about the effects of EU policy and globalization, including unemployment, foreign ownership, and cultural penetration.
* The EU will not include Russia. The Europeans, nevertheless, will seek to engage Moscow—encouraging stability and maintaining dialogue. Although Russia will continue to recede in importance to the European governments, they will use US handling of Russia as a barometer of how well or poorly Washington is exerting leadership and defending European interests.

Economic Reform & Globalization. EU governments will continue to seek a "third way" between state control and unbridled capitalism: piecemeal and often unavowed economic reform driven in part by an ever denser network of overseas business relationships and changes in corporate governance. Lingering labor market rigidity and state regulation will hamper restructuring, retooling, and reinvestment strategies. Europe will trail the United States in entrepreneurship and innovation as governments seek ways to balance encouragement of these factors against social effects. Thus, Europe will not achieve fully the dreams of parity with the United States as a shaper of the global economic system.

In Prague, Vienna, and other European capitals, protestors have questioned the merits of globalization. By 2015, Europe will have globalized more extensively than some of its political rhetoric will suggest. It also will have less difficulty than other regions coping with rapid change because of high education and technological levels. States will continue to push private sector competitiveness in the international market. Three of the top five information technology centers in the world will be in Europe: London, Munich, and Paris.

Many Europeans will see the role of foreign policy as protecting their social and cultural identities from the "excesses" of globalization—and from its "superpatron," the United States. One of the ways in which leaders will respond will be to clamor for greater political control over international financial and trade institutions.

The aging of the population and low birthrates will be major challenges to European prosperity and cohesion. Greater percentages of state budgets will have to be allocated to the aging, while, at the same time, there will be significant, chronic shortages both of highly skilled workers in IT and other professions and unskilled workers in basic services. Legal and illegal immigration will mitigate labor shortages to a limited extent but at a cost in terms of social friction and crime. As EU governments grapple with immigration policy and European and national identity, anti-immigrant sentiment will figure more prominently in the political arena throughout Western Europe.

Turkey. The future direction of Turkey, both internally and geopolitically, will have a major impact on the region, and on US and Western interests. Shifting political dynamics; debates over identity, ethnicity and the role of religion in the state; and the further development of civil society will figure prominently in Turkey's domestic agenda. The road to Turkish membership in the EU will be long and difficult, and EU member states will evaluate Turkey's candidacy not only on the basis of economic performance, but on how well it tackles this comprehensive agenda. Part of Turkey's success will hinge on the effectiveness of a growing private sector in advancing Turkey's reform efforts and its goal of full integration in the West. NATO's involvement in the Ballkans and expected enlargement in southern Europe will increase ties between Turkey and the West.

By dint of its history, location, and interests, Turkey will continue to pay attention to its neighbors to the north—in the Caucasus and Central Asia—and to the south and east—Syria, Iraq and Iran. With few exceptions, these states will continue to struggle with questions of governance. As Turkey crafts policies toward the countries in these regions, no single issue will dominate its national security agenda. Rather, Ankara will find itself having to cope with regional rivalries—including what policies to adopt toward internal and interstate conflicts—proliferation of weapons of mass destruction, the politics and economics of energy transport, and water rights.

Europe and the World. Europe's agenda will require it to demonstrate influence in world affairs commensurate with its size in population and economic strength. The EU's global reach will be based primarily on economics: robust trade and investment links to the United States and growing ties to East and Southeast Asia and Latin America.

In dealing with matters outside the region, European leaders will construe their global responsibilities as building legal mechanisms, encouraging diplomatic contact, and—to a lesser extent—providing nonmilitary aid. They will respond sporadically to foreign crises—either through the UN or in ad hoc "coalitions of the willing" with Washington or others—but they will not make strong and consistent overseas commitments, particularly in regard to sending troops.

Transatlantic Links. Economic issues will have overtaken security issues in importance by 2015, and the United States will see its relations with Europe defined increasingly through the EU, not only on the basis of trade but in the context of using economic tools—such as aid and preferential trading regimes—to underwrite peace initiatives.

By 2015, NATO will have accepted many, but not all, Central/Eastern European countries. European Security and Defense Policy will be set in terms of partnership with, rather than replacement of, NATO.

Canada
Trends. Canada will be a full participant in the globalization process in 2015 and a leading player in the Americas after the United States, along with Mexico and Brazil. Ottawa will still be grappling with the political, demographic, and cultural impact of heavy Asian immigration in the West as well as residual nationalist sentiment in French-speaking Quebec. The vast and diverse country, however, will remain stable amidst constant, dynamic change.

Ottawa will continue to emphasize the importance of education, and especially science and technology, for the new economy. Canada also will promote policies designed to stem the flow of skilled workers south and will seek to attract skilled immigrants—especially professionals from East and South Asia—to ensure that Canada will be able to take full advantage of global opportunities. The question of Quebec's place in the country will continue to stir national debate.

Canada's status as the pre-eminent US economic partner will be even more pronounced in 2015. National sensitivity to encroaching US culture will remain, even as the two economies become more integrated. Ottawa will retain its interests in the stability and prosperity of East Asia because of growing Canadian economic, cultural, and demographic links to the Pacific region. As additional trade links with Latin America are developed through the North American Free Trade Agreement and a likely Free Trade Area of the Americas, Canada increasingly will take advantage of developments in the Western hemisphere. Although Canadians will focus more on Latin America and less on Europe, they will still look to NATO as the cornerstone of Western security. Like Europeans, Canadians will judge US global leadership in terms of the relationship with Russia, especially regarding strategic arms and National Missile Defense (NMD).

Despite the relatively small size of Canada's armed forces, Ottawa still will seek to participate in global and regional discussions on the future of international peacekeeping. Canada will continue to build on its traditional support for international organizations by working to ensure a more effective UN and greater respect for international treaties, norms, and regimes. Canadians will be sympathetic to calls for greater political "management" of globalization to help mitigate adverse impacts on the environment and ensure that globalization's benefits reach less advantaged regions and states.

Latin America: Average Annual Population Growth: 1998-2015

Latin America
Regional Trends. By 2015, many Latin American countries will enjoy greater prosperity as a result of expanding hemispheric and global economic links, the information revolution, and lowered birthrates. Progress in building democratic institutions will reinforce reform and promote prosperity by enhancing investor confidence. Brazil and Mexico will be increasingly confident and capable actors that will seek a greater voice in hemispheric affairs. But the region will remain vulnerable to financial crises because of its dependence on external finance and the continuing role of single commodities in most economies. The weakest countries in the region, especially in the Andean region, will fall further behind. Reversals of democracy in some countries will be spurred by a failure to deal effectively with popular demands, crime, corruption, drug trafficking, and insurgencies.

Latin America—especially Venezuela, Mexico, and Brazil—will become an increasingly important oil producer by 2015 and an important component of the emerging Atlantic Basin energy system. Its proven oil reserves are second only to those located in the Middle East.

Globalization Gains and Limits. Continued trade and investment liberalization and the expansion of free trade agreements within and outside of Latin America will be a significant catalyst of growth. Regional trade integration through organizations such as MERCOSUR and the likely conclusion of a Free Trade Area of the Americas will both boost employment and provide the political context for governments to sustain economic reforms even against opposing entrenched interest groups.

Latin America's Internet market is poised to grow exponentially, stimulating commerce, foreign investment, new jobs, and corporate efficiency. Although Internet business opportunities will promote the growth of firms throughout the region, Brazil, Argentina, and Mexico are likely to be the biggest beneficiaries.
Shifting Demographics. Latin America's demographics will shift markedly—to the distinct advantage of some countries—helping to ease social strains and underpin higher economic growth. During the next 15 years, most countries will experience a substantial slowdown in the number of new jobseekers, which will help reduce unemployment and boost wages. But not all countries will enjoy these shifts; Bolivia, Ecuador, Guatemala, Honduras, Nicaragua, and Paraguay will still face rapidly increasing populations in need of work.

Democratization Progress and Setbacks. By 2015, key countries will have made some headway in building sturdier and more capable democratic institutions. Democratic institutions in Mexico, Argentina, Chile, and Brazil appear poised for continued incremental consolidation. In other countries, crime, public corruption, the spread of poverty, and the failure of governments to redress worsening income inequality will provide fertile ground for populist and authoritarian politicians. Soaring crime rates will contribute to vigilantism and extrajudicial killings by the police. Burgeoning criminal activity—including money laundering, alien smuggling, and narcotrafficking—could overwhelm some Caribbean countries. Democratization in Cuba will depend upon how and when Fidel Castro passes from the scene.

Growing Regional Gaps. By 2015, the gap between the more prosperous and democratic states of Latin America and the others will widen. Countries that are unable or unwilling to undertake reforms will experience slow growth at best. Several will struggle intermittently with serious domestic political and economic problems such as crime, corruption, and dependence on single commodities such as oil. Countries with high crime and widespread corruption will lack the political consensus to advance economic reforms and will face lower growth prospects. Although poverty and inequality will remain endemic throughout the region, high-fertility countries will face higher rates of poverty and unemployment.

The Andean countries—Colombia, Venezuela, Ecuador, and Peru—are headed for greater challenges of differing nature and origin. Competition for scarce resources, demographic pressures, and a lack of employment opportunities probably will cause workers' anger to mount and fuel more aggressive tactics in the future. Fatigue with economic hardship and deep popular cynicism about political institutions, particularly traditional parties, could lead to instability in Venezuela, Peru and Ecuador. Resolution of the long-running guerrilla war is key to Colombia's future prospects. The Cuban economy under a Castro Government will fall further behind most of the Latin American countries that embrace globalization and adopt free market practices.

Rising Migration. Pressures for legal and illegal migration to the United States and regionally will rise during the next 15 years. Demographic factors, political instability, personal insecurity, poverty, wage differentials, the growth of alien-smuggling networks, and wider family ties will propel more Latin American workers to enter the United States. El Salvador, Guatemala, Honduras, and Nicaragua will become even greater sources of illegal migrants. In Mexico, declining population growth and strong economic prospects will gradually diminish pressures to seek work in the United States, but disparities in living standards, US demand for labor, and family ties will remain strong pull factors. Significant political instability during a transition process in Cuba could lead to mass migration.

* The growth of Central American and Mexican alien-smuggling networks will exacerbate problems along the US border.

Illegal migration within the region will become a more contentious issue between Latin American governments. Argentina and Venezuela already have millions of undocumented workers from neighboring countries, and resentment of illegal workers could increase. Although most Haitian migrants will head for the United States, Haiti's Caribbean neighbors will also experience further strains.

Significant Discontinuities

The trends outlined in this study are based on the combinations of drivers that are most likely over the next 15 years. Nevertheless, the drivers could produce trends quite different from the ones described. Below are possibilities different from those presented in the body of the study:

* Serious deterioration of living standards for the bulk of the population in several major Middle Eastern countries and the failure of Israel and the Palestinians to conclude even a "cold peace," lead to serious, violent political upheavals in Egypt, Jordan, and Saudi Arabia.
* The trend toward more diverse, free-wheeling transnational terrorist networks leads to the formation of an international terrorist coalition with diverse anti-Western objectives and access to WMD.
* Another global epidemic on the scale of HIV/AIDS, or rapidly changing weather patterns attributable to global warming, with grave damage and enormous costs for several developed countries—sparking an enduring global consensus on the need for concerted action on health issues and the environment.
* A state of major concern to US strategic interests—such as Iran, Nigeria, Israel, or Saudi Arabia—fails to manage serious internal religious or ethnic divisions and crisis ensues.
* A growing antiglobalization movement becomes a powerful sustainable global political and cultural force—threatening Western governmental and corporate interests.
* China, India, and Russia form a defacto geo-strategic alliance in an attempt to counterbalance US and Western influence.
* The US-European alliance collapses, owing in part to intensifying trade disputes and competition for leadership in handling security questions.
* Major Asian countries establish an Asian Monetary Fund or less likely an Asian Trade Organization, undermining the IMF and WTO and the ability of the US to exercise global economic leadership.


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