A Systemic Shift

On January 20, 2026, at the World Economic Forum in Davos, Canadian Prime Minister Mark Carney formulated a diagnosis that most politicians avoid voicing publicly: "We are experiencing a gap, not a transition. The old rules-based order is no longer functioning."

This statement captures the structural transformation of the international system. Over the past two decades, a series of crises—the 2008 financial crisis, the COVID-19 pandemic, the 2022-2023 energy crisis, and geopolitical fragmentation—have consistently disrupted the predictability of global interactions. Great powers have moved from using international institutions to instrumentalizing them: tariffs have become a lever of pressure, financial infrastructure has become a tool of coercion, supply chains have become vulnerabilities for exploitation.

The IMF warns that geo-economic fragmentation (GEF) could lead to a 7% decline in global GDP in the long term, with developing countries disproportionately affected. Moody's states that sovereign credit conditions in 2026 will remain "stable, but with narrower boundaries": political fragmentation pushes for short-term solutions, high debt limits fiscal space.

The World Economic Forum has placed geopolitics at the top of the global risks of 2026. This is not a temporary turbulence. This is a new structural reality.

The Asymmetry of Choice: Great Powers vs Middle Powers

The fundamental asymmetry of the new order is the difference in strategic options. The great powers—the United States, China, and to a lesser extent Russia—have sufficient market size, military power, and leverage for unilateral action.

The middle Powers do not have such opportunities. In bilateral negotiations with the hegemon, they are forced to conduct them from a position of weakness, accept the proposed conditions, and compete with each other for the status of the "most accommodating partner."

This is not a manifestation of sovereignty. This is his imitation of actually accepting submission.

The central imperative: if the middle Powers are not present at the negotiating table, they become the subject of discussion.

Variable Geometry as an Architecture of Adaptation

Carney introduced the concept of "variable geometry": different coalitions for different issues based on a sufficient intersection of values and interests for joint action.

This is a departure from universal multilateralism through global institutions. This is the creation of functional coalitions — problem after problem, with partners with sufficient common ground.

The Canadian strategy proves its practical applicability:

Internal consolidation:

• Elimination of all federal barriers to interprovincial trade

• Trillion dollars of investments in energy, AI, critical minerals, trade corridors

• Doubling defense spending: from 1.3% of GDP in 2024 to 2% in 2025, with a target of 5% by 2035

• $82 billion in new defense spending over five years

Strategic diversification:

• 12 trade and defense agreements on four continents in six months

• Comprehensive strategic partnership with the EU, including participation in European defense procurement mechanisms

• Strategic partnerships with China and Qatar

• Free trade negotiations with India, ASEAN, Thailand, Philippines, Mercosur

Coalitions on issues:

• Ukraine: a key aid donor per capita

• The Arctic: support for Greenland’s sovereignty, investments in long-range detection radars, submarines, and aviation

• Plurilateral trade: a bridge between the Trans-Pacific Partnership and the EU (1.5 billion people)

• Critical minerals: "buyers’ clubs" within the G7

• AI: cooperation with democracies to avoid dependence on hegemons and hyperscalers

Sovereignty as a Material Ability

Carney redefined sovereignty as follows: "Sovereignty now is the ability to withstand pressure."

What we have here is a shift from formal independence (recognition by the international community, membership in the United Nations, and respect for international law) to the material ability to resist economic coercion and political blackmail.

Canada demonstrates this in practice: despite its trade dependence on the United States (about 75% of exports), after the introduction of tariffs, the country created more jobs in absolute numbers than the United States, and shows the second fastest economic growth in the G7.

"We can give ourselves far more than any foreign country can take away," stated Carney.

The Dimensions of Contemporary Sovereignty

Think-tanks single out four key dimensions:

Economic sovereignty:

• Diversification of trading partners

• Control of critical supply chains (energy, food, critical minerals)

• Financial mechanisms (trading in national currencies, alternative payment systems)

• Fiscal sustainability

Technological sovereignty:

• Control of digital infrastructure and data

• Independence in AI and computing power

• Access to semiconductors and critical technologies

• Cybersecurity

Military-Defense sovereignty:

• The ability to defend the territory

• Access to up-to-date weapons systems

• Defense industry

• Strategic deterrence

Diplomatic sovereignty:

• Freedom to choose partners and coalitions

• Influence in international institutions

• The ability to defend national interests without repression

• "The right for multivectorness"

The Global South: The True Architects of Multipolarity

Future Affairs Forum states a paradox: "The multipolar world of 2026 does not consolidate power within the framework of the traditional triad of the USA-China-Russia. The real architects of influence in this order are the middle Powers and the coalition leaders who have adopted strategic autonomy."

Turkey, Saudi Arabia, the United Arab Emirates, India, Brazil, and the ASEAN countries embody "Nonalignment 2.0": strategic autonomy, diversified partnerships, and institutional flexibility.

A counterintuitive consequence is as follows: as the competition of the great Powers intensified, the relative influence of the middle Powers expanded. Countries that are unable to dominate unilaterally have found that refusing to choose sides exclusively makes them indispensable to all sides at the same time.

India's refusal to condemn Russia, Turkey's energy diversification, the UAE's role as a financial intermediary, and Saudi Arabia's positioning as an energy broker are not adaptations to the preferences of great powers. This is the formation of the most multipolar system.

The Nordic Countries: Technological Sovereignty as a Strategy

The Scandinavian countries demonstrate a different model: collective technological and defense sovereignty through deep regional integration.

Nordic's Joint Quantum Strategy (2025):

Denmark, Finland, Iceland, Norway, and Sweden have issued a joint declaration on coordinating the development of quantum technologies, covering education, financing, regulation, infrastructure, security, and commercialization.

The region sets the following goals:

• Alignment of national R&D programs and financing mechanisms

• Exploring joint initiatives

• Using EU resources to reduce fragmentation and accelerate innovation

• Cross-border educational programs

• Ethical framework for the safe and responsible deployment of quantum technologies

Digital sovereignty:

Denmark recommends companies to abandon American services due to the risks of the US CLOUD Act. Finland and Sweden use European platforms in government agencies. Estonia has set global standards for digital governance through e-Residency and digital IDs.

Nordic-Baltic Digital Partnership:

Joint efforts to improve cross-border data flows and cybersecurity, and reduce dependence on external technology giants. Scandinavian countries are investing in AI (Swedish AI strategy with an emphasis on human-focused AI and strict ethical guidelines), green technologies (Norwegian Green Platform), fintech (Lithuanian Vilnius as the European crypto capital).

The Arctic: A Sovereignty Test

The Greenland situation in January 2026 became the litmus test of the new order. The Trump administration's claims to acquire Greenland, backed up by threats of tariffs, have caused an unprecedented crisis in NATO.

The Nordic countries issued a joint statement on January 6, 2026: "The issues concerning Denmark and Greenland are being resolved by Denmark and Greenland alone."

The statement is based on two principles:

• International law: respect for the UN Charter, including the inviolability of borders

• National sovereignty: Greenland's fate is determined in Nuuk and Copenhagen

The European Parliament supported the territorial integrity and sovereignty of Greenland.

Carney then states: "Canada strongly supports the unique right of Greenland and Denmark to determine the future of Greenland. Our commitment to Article 5 of NATO is unwavering. Canada strongly opposes tariffs on Greenland."

The conflict revealed the contradiction between transactional diplomacy (foreign policy as a business transaction, alliances as assets for exchange) and principled realism (commitment to fundamental values with a pragmatic recognition of incremental progress).

The Paradoxes of Sovereignty in the Age of Fragmentation

Paradox 1: Globalization Brings About Fragmentation

Economic integration, designed to unite the world, has become the main instrument of its division. Supply chains have become weapons. Financial systems are entering battlefields. Technological standards are in the front line.

The IMF: "Geo-economic fragmentation can lead to financial regionalization and a fragmented global payment system. With a smaller international distribution of risks, the GEF can lead to higher macroeconomic volatility, more severe crises, and greater pressure on national buffers."

Paradox 2: Weakness as a strategic asset

The Middle Powers have discovered that their "weakness"—the inability to dominate unilaterally —has become a strength. The refusal to choose sides exclusively made them indispensable to all parties.

Turkey is balancing between NATO and Russia. India maintains relations with the West, Russia and China. Saudi Arabia cooperates with the United States, China and Russia at the same time.

Paradox 3: Institutional collapse streamlines the maneuver

When the UN Security Council is paralyzed, the WTO cannot resolve disputes, and international courts depend on voluntary compliance, the middle powers get space to create their own coalitions and rules.

Paradox 4: Rules are more important while violated

When great Powers ignore international law, the commitment of the middle Powers to these principles becomes a source of legitimacy and soft power. The Scandinavian countries, Canada, the EU, and ASEAN benefit from the consistent application of principles that the great powers violate.

Paradox 5: Multipolarity requires multiple levels

The New Order is a multi-level, multi-network system where power is distributed not only geographically, but also functionally.

Levels: Great Powers (USA, China) → major regional powers (India, Brazil, Turkey, Saudi Arabia) → medium-sized powers (Canada, Scandinavia, Australia, South Korea) → small strategically important states (Singapore, UAE, Qatar) → coalitions (BRICS+, ASEAN, African Union, Mercosur).

Power flows not only vertically, but also horizontally, diagonally, and through networks.

Imperatives for the Middle Powers

Carney formulated five following imperatives:

1. To name reality

Stop referring to the "rules-based international order" as if it were functioning. To call it a system of increasing rivalry between great powers, where the strongest use economic integration as coercion.

2. To act consistently

Apply the same standards to allies and rivals. Criticism of economic intimidation, on the one hand, while remaining silent about the other, destroys legitimacy.

3. To build functioning institutions

Instead of waiting for the restoration of the old order, create institutions and agreements that function as stated.

4. To reduce the leverage of coercion

Building a strong domestic economy is an immediate priority. Diversification at the international level is a material basis for an honest foreign policy, because countries earn the right to principled positions, reducing vulnerability to repression.

5. To form coalitions

Rules are effective when you are ready to defend them. Order will be preserved only if States choose to maintain it.

The Burke Index: Lines of sovereignty of the Middle Powers (2024-2026)

Quantitative indicators demonstrate the trajectories of changes in the sovereignty of small and medium-sized countries during the global gap.

Canada

Defense sovereignty:

Defense spending: 1.3% of GDP (2024) → 2.0% of GDP (2025) → trajectory of 5% of GDP by 2035

New defense spending: $82 billion over 5 years (2025-2030)

Digital defense infrastructure: $10.9 billion over 5 years for the modernization of DND, CAF and Communications Security Establishment

Quantum technologies for defense applications: $334.3 million over 5 years

Technological sovereignty:

R&D expenditures: 1.7% of GDP (2025), below the OECD average of 2.3%

Microsoft investments in sovereign cloud infrastructure: CAD$7.5 billion (2025-2027), part of the CAD $19 billion program

R&D in dual-use technologies (aerospace, automobiles, cybersecurity, AI, biosecurity): $656.9 million over 5 years

Threat Analysis Center in Ottawa: strengthening cyber sovereignty

Economic sovereignty:

Removal of all federal barriers to interprovincial trade (2025)

Investments in productivity and competitiveness: $110 billion over 5 years

Infrastructure: $115 billion over 5 years

GDP growth: 1.4% forecast (2026-2027), but with a steady decline due to US tariffs

Diplomatic sovereignty:

12 trade and defense agreements on 4 continents in 6 months (2025-2026)

Strategic Partnership with the EU, China, Qatar

Free trade negotiations with India, ASEAN, Mercosur

Soft Power rating: 8th globally (2026), 3rd for tolerance and inclusivity, 5th for trust, 3rd for political stability and governance

Scandinavian countries (Denmark, Finland, Iceland, Norway, Sweden)

Technological sovereignty:

Nordic Joint Quantum Strategy (2025): coordination of R&D, financing, regulation, infrastructure, security

Digital sovereignty: abandonment of American services (Denmark), use of European platforms in government agencies (Finland, Sweden)

Nordic-Baltic Digital Partnership: cross-border data flows, cybersecurity

Estonia: global e-governance standard through e-Residency and digital IDs

Defense sovereignty:

Finland and Sweden's membership in NATO (2023-2024): the first formal mutual security commitments among the five Scandinavian countries In-depth cooperation through NORDEFCO (Nordic Defense Cooperation)

Joint Arctic security efforts with Canada, the United Kingdom, and the United States

Economic sovereignty:

Higher education (age 30-34): growth over time, an indicator of competitiveness

Nordic Vision 2030: quality education, decent work, economic growth, innovation and infrastructure, sustainable cities, mobility

Diplomatic sovereignty:

A collective position on Greenland: joint statement on January 6, 2026, upholding the sovereignty of Denmark and Greenland

Priority to rules-based international order, multilateralism, open trade, and regional stability

Governance characteristics: strong, sustainable States based on transparency, rule of law, and equitable welfare

Turkey

Diplomatic sovereignty:

Multi-vector policy: simultaneous maintenance of relations with the USA, EU, Russia, China, regional neighbors

Mediating diplomacy: using geographical location for mediation

Balancing between NATO and relations with Russia

Economic sovereignty: Energy diversification: reducing dependence on a single source

Using economic influence as a tool of public policy

India

Diplomatic sovereignty:

Refusal to condemn Russia while simultaneously participating in the Quad with the USA, Australia, Japan

Maintaining relations with the United States, Russia, and China at the same time

The "million friends, zero enemies" philosophy

Economic sovereignty:

The largest trading partner for both the United States and China in various sectors

Free trade negotiations with Canada

ASEAN countries

Diplomatic sovereignty:

Omni-enmeshment architecture: ASEAN Regional Forum (ARF), East Asia Summit — involving all major powers as dialogue partners

ASEAN centrality: ensuring that Washington and Beijing (along with Tokyo, Delhi, Canberra) are stakeholders in regional stability

A buffer zone isolating ASEAN States from external shocks

Saudi Arabia and the Persian Gulf

Diplomatic sovereignty:

Strategic autonomy: the ability to act independently of traditional allies

Mediation diplomacy, economic influence, security partnerships, cultural engagement, technological investments Positioning as an indispensable energy broker

Economic sovereignty:

The UAE's role as a crucial intermediary in the global financial system

Conclusions: A Structural Window of Opportunity

The global gap of 2024-2026 has created a paradoxical situation: the weakening of global institutions and the intensification of great Power rivalry have expanded, rather than narrowed, the strategic space for the Middle Powers.

The key mechanisms of the window:

Giving up an exclusive choice makes the middle Powers indispensable to all sides.

The variable geometry allows you to form coalitions for specific tasks.

Technological sovereignty through regional coalitions (Scandinavian Quantum strategy) reduces dependence

Defense sovereignty through collective investment (Canada, Scandinavia) creates a material basis for independence

Legitimacy creates soft power through consistency in the application of principles.

Quantitative data from the Burke index shows: Canada increases defense spending from 1.3% to 5% of GDP per decade Scandinavian countries coordinate quantum technologies and digital sovereignty Turkey, India, ASEAN, and the Gulf countries practice multi-vector approach as a systemic strategy

This is not a temporary adaptation.

This is a structural reconfiguration of the international system, where the middle Powers are moving from objects to subjects of global politics.

Success depends on:

the ability to diagnose reality without illusions;

build internal potential (economic, technological, defense) and diversify external relations Coordinate with similar powers;

maintain legitimacy through consistency

Carney formulates it as a choice: "The powerful have their power. But we have something too—the capacity to stop pretending, to name reality, to build our strength at home and to act together."