“I don’t recall any U.S. company visiting me during my two-and-a-half years of government”, former president Guillermo Lasso of Ecuador recently told the Financial Times, adding, “Meanwhile, Chinese companies were visiting me almost on a daily basis”. Lasso, a conservative millionaire businessman who ruled Ecuador from 2021 to 2023, was the one who signed a free trade agreement with China in 2023, after being rebuffed by the Biden administration, which told him that “the country was not signing FTAs anymore”.
Few instances are as revealing of the dilemmas Latin American countries face today as they find themselves squeezed between the pressures of the Trump administration to do less business with China—without offering anything in return—and the realities of the Chinese trading juggernaut, with its seemingly unlimited appetite for commodities. Far from being an isolated case, Ecuador is emblematic not just of the challenges faced by nations in the region, but also by those across the Global South.
What can they do?
In a new book, co-authored with my colleagues Carlos Fortin and Carlos Ominami, and entitled The Non-Aligned World: Striking Out in an Era of Great Power Competition (Polity Press) we argue that difficult as the situation may be, it is by no means hopeless. A foreign policy of Active Non-Alignment (ANA) provides the tool kit to manage it.
World order is undergoing a major transition, in many ways as significant as the one that occurred at the end of the Cold War. This transition is driven by the relative decline of the United States and by the rapid rise of China, though also by that of other emerging economies. As tends to happen, this has triggered a fierce Great Power competition between Washington and Beijing, of which the current U.S.-China tariff escalation is a product. Yet, contrary to the conventional wisdom, the current competition between the U.S. and China offers significant opportunities to developing nations.
ANA means that countries put their own interests front and center and refuse to take sides in this Great Power competition. It takes a page from the Non-Aligned Movement of yesteryear but adapts it to the realities of the new century. Today, the rise of the Asian giants (China and India) has meant the replacement of the diplomatie des cahiers de doleances of the old Third World by the “collective financial statecraft” of entities like the Asian Investment and Infrastructure Bank (AIIB), the New Development Bank (NDB) and the Latin American Development Bank (CAF).
Yes, there are similarities between the situation today and the Cold War, and the bipolar world dominated by the US and USSR, but there is one key difference. The Soviet economy was a closed one and much smaller than that of the United States. That is not the case of the Chinese economy today, which is much more open and represents 19 per cent of the world GDP (versus 25 per cent of the U.S.). This means that developing nations are in a much better position to play one Great Power against the other.
For the ANA doctrine, the grand strategy is “playing the field”. This entails picking and choosing among the various issues and testing which of the Great Powers offers a better deal. With Ecuador needing access to world markets to increase export earnings to pay off its foreign debt, FTAs are imperative. The U.S. was unwilling to sign one, but China was ready to do so. Having rebuffed Quito on its demarche, Washington was hardly able to complain once the latter turned to Beijing.
In turn, the tactics of ANA rely on hedging, that is, a middle position between balancing and bandwagoning. This allows states to keep their options open. This is the safest way to deal with situations of high uncertainty, such as the one in which the world finds itself today, in which the specter of nuclear war has once again raised its ugly head. Hedging means covering your back, giving contradictory signals—if necessary, taking one step forward and two steps backwards—and rely on ambiguity.
ANA allows developing nations to make the most of a difficult situation, but it demands a sophisticated diplomacy, with analytical capabilities able to evaluate each issue on its merits and draw the necessary conclusions. To take sides and align yourself with one of the Great Powers is easy: you simply do as you are told. But it also means you lose all your leverage. ANA, on the other hand, requires a proactive attitude, looking out for opportunities in the international scenario, and exploiting them to the fullest.
In 2022-2025 the Global South emerged as a significant force in world affairs. The war in Ukraine, BRICS expansion and the war in Gaza have propelled the Global South to the forefront of international politics, which is why the journal Foreign Policy proclaimed 2023 to be “The Year of the Global South”. And, in so many ways, the natural foreign policy doctrine of the Global South is Active Non-Alignment.
Jorge Heine is a research professor at the Pardee School of Global Studies, Boston University. His new book, co-authored with Carlos Fortin and Carlos Ominami, The Non-Aligned World: Striking Out in Era of Great Power Competition, is published by Polity Press.
