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The second decade of the 21st century has been marked by the return of political economy, as realpolitik has replaced the globalization theme in the framework of geopolitics. Considering the key events in 2014 - the Ukraine crisis being the most prominent, but also the fall in the price of oil and the struggles of the eurozone - relative standing in the global economy is now one of the most important factors in the relations between major geopolitical actors.

Military alliances are reinforced by economic linkages among the allied countries. Regional integration efforts take into account market opportunities and risks as well as security challenges. Two agreements currently under negotiation - the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership - have the potential to create a new level of coordination between the United States and its partners. The accords would not only impact trade, but also aim at regional regulatory harmonization. The two partnership blocs, covering the Atlantic and the Pacific, would add political ingredients to economic interdependencies, positively influencing security coordination among partner states.

The return of political economy for global interdependencies

In the post-Cold War period, globalization was defined through diminishing trade and investment barriers. This created growing interdependencies among nation states, suggesting that liberalized markets and open democracies were the recipe for prosperity. Statistical data observed in both trade and investment stands as proof of how markedly global integration developed from the early 1990s until 2008. Eastward expansion of NATO and the European Union, coupled with the secure dominance of the world's oceans by U.S. naval forces, seemed to create the framework for a world dominated by Western values. It was a framework for complete peace - a peace guaranteed and supported by the integration of the global economy.

The processes that developed in the 1990s convinced everyone that global integration was not only achievable, but would also provide the needed support for global sustainable development. In that spirit, in 2001 the World Trade Organization launched the Doha Round of talks. Members convened in Qatar, hoping to spur developed and developing countries to compromise on conflicting trade policies. It was high time for true globalization, and the participating countries hoped to free up markets in agriculture, manufacturing, and services. The deadline of January 2005, set in Qatar, was never reached, while signs of failure began to show as early as 2003, when participants started missing deadlines on deals, and a September WTO meeting in Cancun, Mexico, collapsed.

The financial crisis of 2007-2008 further illustrated the vulnerabilities created by interdependencies. Finally, as the Ukraine crisis unfolded, 2014 affirmed the dominance of the political in "political economy" - a return to the realpolitik game of power. With the West having enough problems of its own, it took awhile for Europe to enforce sanctions. Once they are installed, it was a political decision, one that marked a return to hard economic competition at the global level. There's also the speculation around the oil price drop and the so-called currency wars, but it was the sanctions that essentially showed that everything is political after all. The dream of a closely integrated world driven by market forces - the main ideological trend of the 1990s - has shown its limitations, as recent events revealed that the nation-state remains a key player in international affairs.