Publications - Monographs and Scientific Edited Books

The process of international integration and decision-making of individual countries in the globalized world economy will determine fundamental differences not only of an economic, but also of a cultural and social nature. The process when states integrated around one hegemon is becoming a thing of the past and countries are now looking for mutual points of interests and cooperation in the new multipolar world. We can assume that the process of integration based on an equal partnership of states and the process of trading in national currencies will be strengthened even more in the near future. If the original process of integration was primarily economically and geopolitically motivated, the current process of integration takes place in connection with the transformation of civilization models. The current integration process is the result of a new form of cooperation and solutions offered to all countries involved. This fundamental difference in integration motives and principles is likely to expand and may become a future long-term phenomenon.

Accelerating development of the global society brings challenges to the new perspective on polarization that is taking place at different levels. While the Western civilization historically saw the increase of physical assets as the basic condition for development, today it is the ability to use information, work with it and capitalize on the conditions set within a given society. Understanding the current changes in the socio-economic structure of society requires a multidimensional approach. In terms of polarization, it is not just a question of income and wealth, but it is a complex of factors acting on the social position and opportunities of a particular individual, group of people, region or state. Their different adaptability to changing conditions will be the determining factor in the new form of polarization in the world economy. It is clear that it will be necessary to move from a simple understanding of polarization as income and wealth to a much more complex and comprehensive examination of the polarization of society. The fundamental change in the understanding of polarization lies in a comprehensive examination of the conditions of life in different countries and regions that determine the functioning of individuals and societies.

One of the new models of integration is represented by the BRICS group of countries, which, in spite of large differences in economic structure and level of economic and social development, have achieved favorable results in terms of their share of the world GDP, foreign exchange reserves, net investment position, developments in the external macroeconomic balance, as well as in the stability and sustainability of public finances. The BRICS countries have seen a significant rise in their share of the world GDP in purchasing power parity terms, reaching for the first time in 2023 a higher level than the G7 industrialized countries. We can expect the BRICS countries to continue their upward trend in the medium and long term. At the same time, the BRICS member states, including the BRICS Plus countries, have a more favorable development of the current account of the balance of payments compared to the G7 countries, which is positively reflected in the share of the BRICS countries of the total foreign exchange reserves, which is incomparably higher than that of the G7 countries. Importantly, the BRICS countries have a more favorable evolution of their net investment position compared to the G7, but the most significant differences can be observed in the fiscal area, which may have a negative impact on polarization, other socio-economic developments, as well as food and energy security.

The global economy has been hit by several economic shocks in recent years, with geopolitical tensions rising and persisting to this day. In response to these and other concerns, some governments have become more skeptical about the trade benefits and have taken steps to reorient production and shift trade towards friendly countries. As it turns out, the period of low oil prices that we have enjoyed since about the second half of the millennium second decade is probably over. The reasons are not on the supply side or on the demand side, but the rise in prices is due to geopolitical instability and the security situation, with a number of countries unable to reach their production potential because of violence, sanctions, internal and international conflicts. Although the wholesale gas price has fallen significantly compared to 2022, it is still more than two and a half times the pre-crisis level. High energy prices from 2021-2022 were also passed on to consumers in 2023, which continues to dampen domestic demand. Given that the European gas market has become more dependent on LNG following the cut-off of supplies from Russia, and it now depends more on uncontrollable factors such as the weather or the geopolitical situation in the world, it is necessary for policymakers to protect European consumers, at least in part, from the global commodity prices volatility.

Geopolitical developments and the associated policy responses of the world's major economies have confronted the openness of the globalization process and shown how quickly interdependence as a source of security and prosperity can become a potentially highly economically costly vulnerability. The pandemic crisis and the return of war to Europe, coupled with the energy shock, have forced the European Union to rethink its relations with the rest of the world and to anchor open strategic autonomy within the framework of its new economic-security paradigm. The fragmentation of the global economy, rooted primarily in geopolitics, and the escalating mistrust, security concerns and perceived misalignment of interests in the international space are creating a new volatile environment. Open strategic autonomy is intended to allow the EU to continue to reap the econo¬mic and social benefits of globalization while protecting it from the challenges of rising tensions in the world. For example, geopolitical factors could affect capital and financial flows and the smooth functioning of payment and financial market infrastructures, threatening financial stability across the European Union. Strengthening European financial markets as a coordinated jurisdiction can not only support the EU's financial autonomy, but also has the potential to shape international policies in the future.

Economic growth in the EU has weakened as the ECB continues to tighten monetary policy in 2023. While the services sector was initially supported by the lingering effects of the economic recovery from the SARS-CoV-2 pandemic, the industrial sector was hit hard by tighter financing conditions, relatively high input costs as well as weakening global demand. Lower prices for imported energy commodities contributed to the improvement in the EU's exchange rate and trade balance, with their impact on the resulting balance outweighing that of subdued exports. At the same time, in 2023, the Union managed to further reduce its dependence on energy imports from Russia, in line with the REPowerEU plan. A possible further energy shock (due to the Middle East conflict and related oil price developments) could push up inflation again and slow economic growth in the European Union. In addition to reducing dependence on fossil fuel imports from Russia, it is essential for the EU to address the issue of dependence on imports of critical raw materials (in particular from China), which play a key role in the context of the green and digital transformations.

Comparing G7 the most industrialized countries, we see that economic growth, measured by the percentage change in gross domestic product, was strongest in the US in 2023. The recovery in the labor market was mainly driven by labor force participation of Asian, Latin American and Afro-American ethnicities. Examining income polarization across ethnic groups, we find that the ratio between the highest- and lowest-earning workers is at its long-run high for Asian ethnicity. Income polarization is slightly less for white ethnic employees, and income polarization is lowest for Hispanic and Afro-American employees. Federal debt held by the public continues to increase, and when compared to other categories of discretionary and mandated spending, the cost of maintaining federal debt is the fastest growing expense in the federal budget. In terms of international trade and inter-country relations, the replacement of China as a major trading partner by other countries is of high importance to the US. This is particularly the case from Mexico, which last year in 2023 overtook China as the top exporter of goods to the US for the first time since 2002.

The structure of the main export and import territories has not changed significantly from China's perspective. However, the value of exports to the EU, the USA and Taiwan has fallen more significantly. The deepening of relations with Russia in 2023 has seen an increase in their trade with each other, leading to an increasing weight of trade with Russia in the trade balance, but the weight of this trade is still less than, for example, between China and the Republic of Korea. The exchange rate of the Chinese currency has continued to depreciate, which has had a positive impact on the foreign trade balance and should help to dampen deflationary pressures in the economy due to the rising cost of imports. The gross domestic product created increased by 5.2% in 2023, a higher growth rate compared to the previous year, 2022.

After a one-year slump, the Russian economy is back on a growth trajectory in 2023. Domestic demand, both private and public, was behind the output boom. The increase in household consumption was aided by deferred purchases from the crisis year of 2022 and labor shortages giving way to strong nominal wage growth. Public consumption was dragged up by a strong fiscal stimulus, the need for large infrastructure projects and subsidies to restructure and reorient the economy. The manufacturing industry in particular grew, especially those sectors related to arms production. The flip side of this economic growth was the negative changes in foreign trade and in the fiscal position. The capacity constraints of the domestic economy, as well as the risk of secondary sanctions and the ability of the Russian economy to cope with the necessary structural changes and the completion of the process of reorientation towards other major trading partners, will be the limits to further growth.

The Russian economy has faced Western sanctions since 2014, and they began to mount massively from 2022. The Russian government has taken a number of countermeasures to mitigate the impact of, and resist, the sanctions, which have ultimately resulted in relatively minor negative impacts from 2022. However, the sanctions have caused a number of problems for the Russian economy, the resolution of which is long-term. However, they have not caused the kind of difficulties that would lead to social unrest or a change in the country's political direction. We expect a continuation of the processes associated with Western sanctions, in particular the reorientation of foreign trade towards countries that are not part of the so-called collective West, the further de-dollarization not only of Russian foreign trade but of global trade as a whole, and the continued restructuring of the Russian economy towards greater economic self-sufficiency.

Despite the complexity and unpredictability of future socio-econo¬mic developments, a very close, constructive and synergistic cooperation of all countries of the world is needed more than ever before. The cooperation should be geared towards tackling critical areas such as saving the planet from ecological and climate disasters, dealing with cyber-attacks, joint action in the use of artificial intelligence, combating deepening income polarization, the growth of poverty, and ensuring health, food and energy security for all people on the planet.