GEOPOLITICS: ITS IMPACT ON GLOBAL BUSINESS Speech at Gabelli School of Business of Fordham University, New York. 24th October 2019 - Andrea Mennillo

1. Andrea Mennillo
“GEOPOLITICS: ITS IMPACT ON GLOBAL BUSINESS”
Introductory speech
Fordham University
Gabelli School of Business
Lincoln Center
October 24, 2019

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Opening Remarks
Good afternoon to everyone. As always, I want to thanks Dean
Rapaccioli for her usual willingness to give space to meetings with
strong and concrete international view.
I also want to thank Father McShane and Rev. Vincent Decola for
their sensitivity for giving green light to these conferences with an
international perspective. Today we focus on geopolitics.
We are here today because it is important to enrich our personal
cultural background starting from knowledge and study.
The objective is to understand what happens around us gathering
information from day by day reality around the world. It is crucial to
know more about international politics and international relations
and related impacts on business activities.
These are just insights that apparently seems very far away from us
but - on the contrary - they are not, because have great
consequences on the way we do business.
Business is global now. Talking about impacts, let’s think about for
example to the relevance of trade agreements, to oil prices changes
during conflicts, etc…
So, welcome to everyone, and thank you for being here with us.
Geopolitics and globalization in the digital era
Geopolitics and globalization are two concepts that it is important
to clarify because they are strictly connected. First of all, what does
geopolitics mean?
Geopolitics is a recent word created to define the complexity of
relations among states in the modern era.

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Rudolf Kjellén, a Swedish political scientist, was the first to use this
word at the beginning of the 20th century and it came into
worldwide use during the World Wars.
Geopolitics is the union of two Greek words - GEO + POLITICS –
where:
o GEO means Hearth and this has to do with a global idea which
oblige us to turn this ancient word into a more contemporary
one that is “international”;
o POLITICS comes from Polis, that means "affairs of the
cities"(according to Aristotle’s ideas), defining the set of
activities associated with the governance of a country, or an
area.
Finally, Geopolitics is the analysis of the relation of international
political power to the geographical setting. Here we come to
globalization.
The current context is strongly dominated by interculturality,
complexity and dynamism.
Globalization is not a phenomenon that is born today but has always
existed and over time took on different connotations depending on
the historical period.
Today therapid growth and spread of new information technologies
applied to telecommunications reduces even more distances
between countries, both referring to economic activities and to
everyday life.
The “winners” in this current scenario are all the companies that:
o deal with the physical transfer of goods (see Amazon, for
example);
o sell intangible services through the network (see big internet
companies, for example).

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However, we have to consider the reality, made up by different
countries, boundaries, commercial treaties, fiscal rules, payment
systems, tariffs, customs duties and taxes (direct and indirect).
Some of the main international economic agreements in force are:
o NAFTA (North American Free Trade Agreement) which is
going to be replaced by the USMCA (which includes Mexico),
introducing the progressive elimination of all tariff barriers
among countries within the agreement;
o the recent Europe-Japan agreement;
o the WTO rules;
o CETA, the agreement between the EU and Canada;
o MERCOSUR, agreements among South American countries;
o bilateral (increasingly widespread) and multilateral
agreements;
o free trade agreements;
In this global arena we have to think about criminal actions so there
are set of laws and procedures to prevent them. For example those
rules related to anti-money laundering. US imposed the Foreign
Account Tax Compliance Act (FATCA) to foreign countries that want
to make business with US citizens in order to contrast tax evasion.
These rules were necessary to manage great growth of international
transactions.
Today it is important to be informed on what is happening around
the world (in USA, there seems to be very little general interest in
what happens outside), because event now has global
consequences, even in real time.
There are important examples of globalization that come from the
past (religious and territorial).
In our Jesuit tradition we have two important men to remember,
both consistent with Ignatian spirituality and its missionary
dynamism:

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o Francis Xavier, was born in XVII century (1506), he brought
the Christian message throughout Asia (in particular, in Japan
and in India). Francis Xavier together with Ignatius of Loyola
was co-founder of Society of Jesus. He is Patron of
Catholic Missions;
o Matteo Ricci, who in the 16th
century dedicated his mission to
the Christianization of China, fully penetrating the Chinese
culture and learning language, tradition up to become a
leading representative of the imperial court, esteemed for his
great experience, and thanks to this he still be remembered in
China even today.
As you see, the evangelical message was the first global message.
Francis Xavier and Matteo Ricci are here great examples.
Coming back to the past means learning from who came before us,
means contemplating and always having in mind valuable
experiences.
The playground is the world and in our daily business life it is
important to know who passed the baton to people like Father
Mcshain and Rev. Vincent Decola.
The same Ignatian spirit today requires from each of us "... the
willingness to participate in social and political life and to develop our
human qualities and professional skills to become more competent
operators and more credible witnesses" (from Principi Generali della
Comunità di Vita Cristiana del 1998). Once again this message tell us
that it is important to acquire the necessary knowledge around us,
to become a bridge between diversity.
Here in Fordham we must be the first who are able to understand
this kind of messages. Knowing history means that we should
understand the globality of Jesus‘ message. A message wich is does
not closed within borders.

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The Christian faith is -in fact- an inclusive concept, it is an attitude of
reciprocity and openness towards the others which goes beyond
political and cultural boundaries.
An other example of globalization, this time a territorial one, is the
Roman Empire expansion, which I often like to mention in my
interventions: from a few huts near the Tiber river, it expands
throughout the Mediterranean and Europe.
Rome was one of the first multi-ethnic and "global" state.
Its open society leads it to attract various Italic people and to
integrate its cultures into a unique "melting pot", from which was
born a state capable of assimilating external elements, enhancing
them and expanding itself to the borders of the world known at that
time.
Geopolitics and Diplomacy
Why is geopolitics so important? Geopolitics, even if involves
different disciplines - such as history, geography, anthropology,
economics and others - is not a science, but rather the study of
specific cases, where there is competition for a territory and for
projects.
The keywords are always dialogue and confront. In all ages.
Activities traditionally delegated to diplomacy and ambassadors.
But what is diplomacy and who was the ambassador?
o Diplomacy comes from the Greek verb „diploun“ (fold in
two). During the Roman Empire the imperial documents, as
„passports“ and transit permits, were fixed on double metal
plates, folded and sewn. These documents were called
"diplomas". Later, this name was used for all the official
documents. The use of the terms "diplomacy" and
"diplomatic" dates back not earlier than 1796, when in
England Edmund Burke began to use it by designing "the set

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of political-institutional procedures through which states
maintain relations with each other". Starting from 1815, after
the Congress of Vienna, the diplomatic service became a real
profession distinct from the politician, thus acquiring juridical
value with norms and prescriptions;
o Geography is related to diplomacy: in the past borders were
mainly set by nature (rivers, mountains, seas,…). Then
borders were sometimes decided by politics without taking
into considerations people living over a specific land. A fact
that is often a reason for conflict;
o See for example: Kurds is an ethnic group composed of 50
million people divided (by politics) in five nations such as
Turkey, Iran, Iraq, Syria and Armenia. The Kurdish diaspora is
similar to other ethnic group such as the Armenians. Today
Kurdistan is not a State but is a region with geopolitical
relevance. In Syria and Iraq they have gained a special status;
in Iran people live peacefully but in the other countries they
are fighting;
o Current news makes us well understand what today's
geopolitics is. See revolutions currently open all around the
world.
Ambassadors were spokesmen and reported to their sovereign.
They represent their own country in other states, where they are in
charge of conducting negotiations and maintaining relationships.
The importance of this role, is demonstrated by the fact that it is the
highest office among the civil servants (the appointment as
ambassador is the highest honor a citizen has received from his
country). In fact, in the republics they had a superior authority to
that of the royal correspondents. In the second millennium, the
countries with the largest diplomacies were: France, Spain, UK,
Vatican City.
Today, technology has changed their role. The web has made
relationships faster and more direct, even among Presidents and

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Prime Ministers. The role of diplomacy has therefore become more
commercial oriented.
In the current global scenario it is therefore important to learn to
relate and to reach points of convergence.
It is not by chance that ambassadors were political experts, trusted,
cautious and with diplomatic ability.
In this context, arises the value of a profession that I know well as
Business Diplomacy.
It consists in establishing and sustaining positive relationships with
foreign government representatives and non-governmental
stakeholders (economic and non-economic) with the aim to build
and sustain legitimacy in a foreign business environment.
Business diplomacy is a way to seize opportunities in the current
globalized world. It requires a set of important competences such
as cross-cultural communication skills, interpersonal influence,
empathy, networking abilities, adaptive thinking, resilience,
knowledge of country’s culture and traditions.
In business diplomacy, what opens doors for multinational
companies worldwide is an individual’s ability to build trust with
rulers, decision-makers, entrepreneurs and leading figures in foreign
institutions – even where such opportunities come intertwined with
complex challenges and barriers to entry.
In business diplomacy, it is one’s reputation, diplomatic talents, and
deep study of the country that make creating important
opportunities.
Geopolitical poles
In this globalized world it is fundamental to be able to analyze
international equilibrium from a wide perspective.

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During decades (years 1950, 1980, 2000, today) the first 5 countries
ranking for GDP, population and military expenditure has changed,
reflecting changes in world balances.
I see 6 big areas of power/influence
1. Three main leading countries: US, China and Russia. They are the
strongest economies of the world with the most powerful
armies.
• Russia has a leading political influence, but a lower economic
power than US and China. It ranks 5th in the world by GDP;
• But they are very different countries in terms of government
systems (only US is a democracy);
• Russia is a huge country, it starts from Europe and covers a
very big part of Asia: Vladivostok1
, a Russian city placed
beyond the Eastern part of China and in front Japan - is 8,30
hours fly from Moscow, vs nearly 5 hours from Los Angeles
to NY;
• Can you imagine the difficulties in governing such a broad
country, with so many differences among areas?
• Today in Russia there is a President on power for 22 years. In
1997 Boris Yeltsin appointed Putin deputy head of the
Executive Office of the President;
• We do not know too much about what happens in Russia.
Considering the foreign policy – from the European point of
view- Russia has a very active role, as it is our neighbor;
• Currently, USA and China are playing a “trade war” in order
to gain the hegemony of the global market.
2. Europe. It is the area that seems to have more stability.
• European Union is facing several internal troubles and it has
to do with populism. So foreign policy is influenced by
internal politics;
• If Europe is home of democracy and through cultural
illuminism its structure shifted from dictatorship to
1
Capital of Primor area (Primorsky Krai), or “Maritime Territory” (from December 2018)

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democracy, today Europe is living a difficult moment.
Differencies among political choices and people values are
increasingly generating mistrust;
• Brexit docet. Today there is a big confusion that should lead
to irreparable damages (even if UK decides to come back);
• From political point of view, it can be considered an
unsuccess, even if economically it is the only way;
• Relations between member states are not fluid and it is
difficult to find a common view on many topics affecting
internal and external affairs (migrations, economic policies,
public accounts);
• Now it is facing the issue of Brexit, in order to find a balanced
agreement with UK;
• It is important for the EU to be able to open a dialogue with
Russia, its most powerful neighbor.
3. The American Continent, in particular South America that has
been freed from colonial control just one century ago
• Venezuela is one of the main oil producers in the world. Its
wealth sudden increased, but it is very polarized in the
society;
• Brazil, Argentina and Chile have natural resources but are
most controlled by foreigners and are not so evolved in
terms of citizens’ quality of life standards and of democratic
processes;
• Canada is a big country, which needs to be contaminated
from outside. Culturally, it is very much connected to the
European world and for some extent even more then to the
US;
• Mexico is a country that needs regulation. Its immigration
brings not only workforce but also brings a sense of
aggregation and social values as family, according to
Christian values.
4. Far East. The Asia-Pacific region is still seeing a quite powerful
economic growth.

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• Japan created the third largest economy in the world after
the war, even though it is now losingground due to the rising
of other countries of the region;
• There are some emerging stars, like South Korea, Indonesia,
Vietnam and the Philippines;
• India, after recent elections is now looking for economic
stability that, the new government will have to reach
through reforms;
• This area has differences in political and economic systems,
in the culture and in the religion (most people are
polytheists);
• It is an area where conflicts still exist.
5. Middle East. An area that was controlled by the British until 50
years ago
• Composed of countries (e.g Kuwait, Qatar, Oman) whose
economy was traditionally based on trade, but then oil
changed equilibriums and relationships. They are countries
governed by emirs with absolute power
• Israelis is surrounded by hostile countries. Alliances are so
changeable that this could push to an alliance with Saudi
Arabia
• Now the scenario is much more complex and the focus is on
the conflict between Sunni and Shia feeded by autocratic
governments and Islamist movements
• Lebanon is a small country but it is crucial for the equilibrium
of the area. It has a great history. There is a strong Shiite
community hostile to Israel. The Sunni and Maronite
Christian presence is lower. If Lebanon is in equilibrium, this
is also valid for the rest of the region
• Lebanon, Israel and Iran are the only countries where
elections exist.
• In Lebanon, the situation is evolving in Beirut. The attack of
the Turkish army in Syria is maybe putting under pressure the
south of Lebanon. We have to add scandals involving
president Hariri and poverty among the population

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6. Africa. It is the most interesting area of the world in terms of
potential
• Africa is now living an ongoing industrial revolution, and it
has great unexploited resources;
• But there are many obstacles for enterprises in sub-Saharan
Africa, such as access to finance as their biggest business
obstacle, energy and political instability;
• Life standards remain very low. More than half of the
extreme poor live in Sub-Saharan Africa. The number of poor
in the region increased by 9 million (1990-2015), with 413
million people (on total of 736 million poor people in the
world) living on less than US$1.90 a day. If the trend
continues, by 2030, nearly 9 out of 10 extreme poor will be in
Sub-Saharan Africa;
• In particular, Nigeria will be the rising star of the next future.
It accounts more than 200 mln people (the same of Brazil, or
2/3 of US population, or Germany + Japan population).
Values and knowledge for profitable international relations
As you can see, we are not alone in this world ... we are always
surrounded by relationships and we have seen how humans have a
strong exploratory nature. Since ancient times they felt the need to
move from their birth areas to explore and learn about new places
...
We are all result of a continuous cultural contamination and I think
that each one of us has the right to express his thoughts.
It does not mean to come into conflict. You are free not to accept
someone’s else vision, but you have the duty to understand him.
If you are here it is because you embed the values of this institution.
One day you will be a leader and, so you have the duty to be

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informed. A leader must start from here, from study, because study
is the bearer of cultural, economic, ethical-religious values.
Knowing and understanding allows us to have profitable
relationships and to make alliances, respecting different cultures,
different values and different religions. Values are the compass for
finding one's way in this world of diversity.
Ancient civilizations have laid the foundations of our being, bringing
specific peculiarities and common traits. For the Western world the
references come from classical Greece and the Roman Empire.
The concepts of polis and happiness for the Greeks, where polis
means respect of the rules, even moral, of coexistence with others
and the right to the pursuit of happiness ...
About happiness: This is what the Greeks called Eudaimonìa. It
comes from the words eu (good) and daimōn (spirit): that was their
concept of happiness. Here we can see happiness as a purpose of
life and as foundation of ethics.
Happiness had a precise role in directing one's conduct. According
to Aristotle, happiness means to live in accordance with complete
virtue, not for some chance period, but throughout a complete life.
Happiness was an attitude of the soul.
This was the purpose of poleis, the ancient Greek city-states (the
most complete form of political organization of Western history). In
a polis, "living well" simply was the happiness of citizens, realized by
logos, the rational principle that put together and gave a sense to
life within the polis. Logos allows us to discuss and decide what is
right and what is wrong, what is good or what is bad.
To Aristotle, polis has a very deep meaning. It is a community, a
physical presence, a relationship. The community arises to make life

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possible and to produce the conditions for a good existence. To live
individually is not enough.
The Greek concept of happiness is not very far from the concepts of
societas and mos maiorum, which was the moral force in the Roman
culture. An idea very similar to the importance given by Jewish
culture to wise men words.
However, do not forget other great civilizations, such as:
• The Caucasian populations, or the Egyptians
• Middle Eastern civilizations
• The ancient Chinese and Japanese cultures
Into the globalizing process, each people take from its ethical-
religious tradition values, criteria and models that give consistency
to a common ethos of humanity.
In all the great religious and ethical traditions there are some
elementary ethical standards gathered around the so-called "golden
rule".
This also applies to the economy, which has a very strong human
foundation, meaning the place for caring for relationships, or for
brotherhood among men. In fact:
• For the Greeks it was oikonomia, which means
administration of the affairs of the house
• In Arabic it is expressed with the term iqtisad which means
moderation
• In Japanise it is keizai, which means good administration of
the country2
Benedict XVI in his Caritas in Veritate, defined the economy as the
place of good relationships, thus making the sense of respect and

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responsibility towards the human family indispensable in this
context of globalization.
To have the guts to admit to your own weaknesses and, unlike
Icarus, to be aware of your own limitations is what will set you apart
as you work towards your hard-earned successes. It is important to
keep your pride in check with what the Greeks called Metis: wisdom
and, again, prudence.
Ethics and business are not contradictory aspects of life – they are
the winning path to sustainability. The challenge today is to prepare
ourselves to be women and men with a sound set of cardinal values
as well as financial notions and entrepreneurial spirit.
Closing remarks
We all live in a continuous cultural contamination, we live in the
middle of globalization. You must be aware that the world is made
from different points of view. The right approach is always to know
who you face and what happens in the world.
So, study and knowledge are very important as well as respect of
different cultures…not only to look in our own garden.
Globalization means great interconnections, trade and exchanges.
The situation today is more sophisticated than in the past.
You must be aware that in a globalized world even the smallest
business is impacted by changes happened somewhere else in the
world:
• The exponential growth of international exchanges
generated, of course, a lot of rules, limits and obstacles;
• Now we are in a digital era and technology is the innovative
element which is giving a new shape to it. Most of the
products and services we buy are produced or managed

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abroad (example: payment services when we use credit
cards abroad);
• Even from advertising and communication point of view, big
international financial institutions leverage on messages
which give a global perspective, also in dealing with complex
international rules.
Here at Fordham you are in the right place, a university that gives
you the right tools to face the global reality which surrounds you and
at the same time to give you the compass of the Ignatian spirit
towards the world.