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<html><body><div>Rahm Emanuel is U.S. ambassador to JapanThe debate about the future of the international economic system has reached a false choice, with some arguing the era of de-globalization is upon us and others hoping a snapback to pre-COVID economic integration is around the corner.Both interpretations are wrong. It is not possible for economic integration to be just like it was before, as if nothing disruptive happened over the last five years. But economic retrenchment to Fortress America or the like would also be unrealistic and misguided.The unprecedented disruptions of recent years have undermined the international consensus surrounding global integration.COVID exposed the weakness of international supply chains. Russian aggression dragged Europe into its first large-scale international land war in decades and revealed the inherent risk of depending on a rogue state for energy resources. And China's active economic coercion and consistent subversion of international rules, even those they had signed onto, have resulted in public dissatisfaction in mature economies with globalization's unequal benefits.China's coercion and Russia's weaponization of energy resources have both demonstrated the link between geopolitics and economics in new ways. The reality is that we are now witnessing Act I, Scene I of a new phase of globalization with a different set of guiding principles.Three principles for the new system are emerging.The twin priorities of cost and efficiency were hallmarks of the previous era. Those priorities are being replaced by stability and sustainability as new guiding principles.The vulnerabilities revealed by the pandemic and the economic sanctions levied in response to Russia's invasion of Ukraine have placed greater emphasis on political stability and economic sustainability.Going forward, in an increasingly unstable world, the strongest economies will be those that provide all parties with a high level of stability and sustainability grounded upon a vibrant legal system and rules-based partnerships. Reports that Apple will proportionately increase production of iPhones in India relative to China should be seen in this light.The second principle guiding the next phase of economic integration will be the importance of energy as a strategic asset, not simply a resource. Energy security will be to the future what market access was to the last 30 years: the most powerful economic tool for advancing U.S. national interests, winning friends and influencing enemies. We must now look at energy through the same strategic lens as market access.Russia has taken the weaponization of energy resources to a new level with its squeeze on European supplies. We have experienced attempts at this before with the OPEC oil embargoes of the 1970s, but Russia has shown a new ruthlessness with the old script.For Russia, the gloves are off, and countering its economic coercion will require a new strategic approach to energy. In Europe's time of need, U.S. reliability as a partner and our natural resource abundance count for more than once thought.Beyond plentiful energy resources, the U.S. is also in possession of advanced technology and research capabilities to dominate the international competition for new clean energy.Increased investment in renewables, battery storage, mini nuclear reactors, hydrogen fuels and energy infrastructure, as made possible by the recent passage of the Inflation Reduction Act and the Bipartisan Infrastructure Law before, will enhance the position of the U.S. in the new world economy. In this new era, energy assets will replace market access as a guiding economic principle.The third factor reshaping the international economy is data. First in the technology sector, with other industries following, we are seeing that it is not about how many products you sell, but how much data you collect that matters.While supply-chain issues and energy security are familiar economic issues, digital rule-making will be the next frontier in the new global paradigm. Every major international financial, industrial and health care company is in the data business one way or another. 
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 Servers at a Facebook data center in Prineville, Oregon. Digital rule-making is the next frontier in the new global paradigm.



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The U.S. is best placed to spearhead initiatives to forge international standards for the digital economy along the lines of many of our bilateral agreements, such as the 2019 U.S.-Japan Trade Agreement. Setting the rules that will govern an ever-growing part of trade is key because if we don't, China will.The good news: America is well positioned to compete in the transformed international economy if we act with an appreciation of the new landscape. The CHIPS Act showed we can muster bipartisan support for secure, stable supply chains for critical technologies.The emergence of the U.S. as an energy exporter makes us a source of energy security for our international allies and friends. The new climate and energy legislation signed by President Joe Biden will only strengthen our leadership.The strength of our political and legal systems continues to reinforce America as a beacon of stability. The recent bipartisanship seen in Congress on guns, infrastructure and climate has only enhanced the U.S. brand at a critical time.The U.S. has an opportunity to lead and shape the future if we comprehend that the principles that guided the last 30 years changed for good. We will not see de-globalization or a nostalgic return to what once was, but the beginning of a new phase in international economic relations. Stability and sustainability, energy security and data rules are the new North Stars shaping the future.
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