Tomorrow's players

Nothing binds two countries more than economic interdependence. When you have a financial relationship, certain things naturally happen:

• You pay more attention
• You learn more about each other
• You are more vested in the other's destiny, therefore you care more about their well-being
• You are very unlikely to want to harm that which can feed you
• You are more likely to understand each other better than before the relationship

Some interesting data. According to this article in the Economic Times (part of India Times), the trade between India and China from 2002-2006 has grown at 50% year-over-year. This compares to 25% growth with any other country. India is one of China's top ten trading partners, and trade is growing fastest among the ten with India. Finally, trade has grown from about $5 billion in 2002 to $37 billion in 2007, and is forecast to be $75b in 2010 (assuming a conservative 25% growth), $113b by 2012, and $225b in 2015.

In another issue of the Economic Times, we learn that trade between India and the whole continent of Africa has grown from $5.2b in 2002 to $26b in 2007, and is forecast to grow to $150b by 2012.

The growth rates with both trading regions (China and Africa) is nothing short of phenomenal.

Two more things to ponder:

1. Together, these three regions represent 3.43 billion people, or just over 51% of the world's population.
2. In 2012, the trade between India and China and India and Africa will be $263b, up from $10.2b ten years prior.

In comparison, the combination of NAFTA (Canada, USA, Mexico) and the European Union represent a population of 942 million people or just under 14% of the world's population, and US trade with Canada, Mexico and the EU was $1.375 trillion, which is obviously bigger than $263b.

I know I haven't looked at US trade with Africa, India and China, and recognize that there are a lot of other factors at play here.

But considering the relative economic potential of the populations of the Western countries vs. that of the Africans, Indians and the Chinese, and the fact that India's trade with these two regions has grown 26 times in ten years, one can't help but think that India's got a lot of upside, and that the economic potential of their population (plus of course those of their very large trading partners) is growing at an incredible rate.

If this growth continues, I wonder what the economic potential India will be a decade from now? Greater than the US? I don't think it'll be that high, but here's one thing that I think will happen - in ten years, more Americans will move to India to improve their lot in life (find jobs, etc.) that will come to American shores. This behavior has already begun as more and more people come here for an education and now rather than stay, go back.

I think Africa, China and India's futures are much more tied to each other than otherwise. If they do end up becoming good friends, establishing connections more reflective of Canada/US relations, the West is in for a pretty humbling time.

If at the same time, America looks upon the rest of the world with arrogant disdain (as I discussed in this post), it is inevitable that as others rise and the gap between have and have not shrinks, they will not admire, or wish to befriend this particular "have" as much as others have in the past. It is good that the sitting President seems more about joining with the world than owning it.

Thank goodness that Vice President Cheney didn't run for President. If he had won, I imagine we'd be calling him Kim Il Cheney [apologies to Koreans everywhere], and building a DMZ between us and Mexico, Canada and everyone else. And when as the sun rose in the East, those nations would be that much more motivated to spank America.

Our job should among other things be to focus on building stronger, friendlier, and more symbiotic relationships with this triumvirate (and everyone else of course) representing more than half the planet.