Making Sense of a Changing World - with Velina Tchakarova

For this latest episode of Fault Lines, I’m joined by one of Europe’s leading geopolitical strategists, Velina Tchakarova.

Wars in Ukraine and the Middle East are often reported as separate events. Velina argues they’re part of a much bigger shift reshaping security, energy, food, industry and the global economy all at the same time.

We explore why resilience now means far more than military strength, why Europe has been slow to adapt to a changing strategic reality, and why governments need to be more honest with their citizens about the choices that lie ahead.

Whether you come to this conversation from an interest in geopolitics, business or simply a desire to better understand the world your family is living in, Velina offers a compelling framework for connecting events that are too often viewed in isolation.

If you’ve ever wondered why so many seemingly unrelated events now feel connected, this conversation is well worth your time.

To learn more about Velina’s work, explore her latest articles and media interviews on the FACE website:
Photo courtesy of ⁠Velina Tchakarova / FACE – For A Conscious Experience.

For more analysis like this, visit Fault Lines on Substack: 👇

https://rodwhiting.substack.com/

Contact: rod@rodwhiting.com

Transcript

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Rod Whiting: 0:00

Hello and welcome to Fault Lines. I'm Rod Whiting and I'm delighted to welcome my guest today, geopolitical strategist Velina Tchakarova, founder of FACE, the For a Conscious Experience consultancy, which helps business leaders and organisations navigate an increasingly complex world. Velina, welcome. Thank you so much for giving us some of your time today. Thank you for the invitation. It's a big pleasure being on your show. The aim of Fault Lines is to help people make sense of the profound changes taking place around us, often at remarkable speed. You've written extensively about what you call the global rupture. What do we mean by that? And why should it matter to an ordinary family here in Britain?

Velina Tchakarova: 0:49

So I work predominantly with geopolitical risks. And just a short reminder, think of the global financial crisis from 2007-2008. And there you go. This was the first, let's say, systemic risk-driven global crisis. We had the second one being the global health crisis linked to COVID in 2020. Now, what is unique, what is new in the global system is that we have not one, but two simultaneously happening proxy wars. one in Ukraine, one in Iran. One started in 2022, now the second one started in 2026. Both are defined as systemic risks because of the scale. It goes beyond the fighting. It affects global economy, global trade, supply chains, and obviously ends in household reality, for example, through inflation or through scarcity of certain products or true fiscal burden for governments. So this has a lot of waves. It starts very, very slowly, and then it takes time to develop. So this is what I conceptualized as global system rupture starting on March 2nd. What happened on March 2nd? Two events of systemic nature, one being the closure of Hormuz, and second being the Iranian attacks on critical infrastructure in the Gulf. And since then, we are no longer talking about a disruption in Hormuz that does not remain simply centered around the Strait of Hormuz. It moves into shipping, into energy, into industrial capacities, into fertilizers, into food prices. And as I explained, it ends in inflation, in hiked interest rates, and eventually government finances. So in that sense, we are in the middle of it. I'm not arguing that the rupture has already manifested itself, but I'm arguing that there is a high possibility for a fourth systemic risk-driven global crisis because of what happened on the 28th of February. And since then, it's ongoing in Iran in parallel to what's going on in Ukraine. And this simultaneity of crises is a unique moment for the global system, which means that, and this I think is the main takeaway for our audience in Europe, we are no longer living through a sequence of separate crises. We are dealing with this simultaneity, which affects our security and defense. It affects our raw material base and energy security. It affects trade, economy, finances. It affects technological domain, and last but not least, of course, the international rules and the institutions. So all of this is simultaneously under pressure at the same time, and it's increasingly reinforcing each other. That means that this global system rupture might manifest as a tipping point for the global system, where I argue if it happens, we will transition towards bifurcating global system, where we will have two specific centers of power, one under the Anglosphere, let's say influence, that would mean United States with allies, with partners, including UK, obviously, and the other one centered around China, Russia. And I really want to highlight not China as most of the experts are claiming. It's a modus operandi of strategic coordination between China and Russia, which makes it so unique. So all of the phenomenons I've mentioned are pretty unique to us as experts, to our political decision makers, to our institutions, because we've never witnessed this kind of events happening not only simultaneously, but also in this kind of scale. And that makes it so challenging to kind of reduce the complexity and understand the patterns of behavior that are related to the global system. And then they are related to the actors trying to navigate in this global system.

Rod Whiting: 5:21

Well, we'll talk more about that relationship, that critical relationship between China and Russia in a little while. I think this is being framed by certainly the mainstream media. and on social media as well, there's a lot of talk about the military aspect of this. And we've talked a lot on Fault Lines about national security in military terms. And one of the things I've really appreciated about your work is that you're viewing, as you've just alluded to, you're viewing security and resilience through a much wider lens, joining the dots between energy, food production, supply chains, industrial capacity, technology, economics. Have we been thinking about resilience far too narrowly?

Velina Tchakarova: 6:03

H Oh, absolutely. And I argue that right now, probably the weakest spot in the so-called collective West and specifically in Europe is the so-called societal resilience. In fact, I do not work with the concept of resilience. I come from the school of Nassim Taleb and I actually work with anti-fragility concept, which is much more concrete in terms of ability not just to react to a crisis, but to emerge stronger out of the crisis. So if you have done your homework in terms of preparation for a crisis, you should not fear the emergence of a crisis because it will make you even stronger. This is a very, very reduced definition of the antifragility concept, And I argue that our political decision makers, and I really want to be more general, I don't want to go into a political spectrum or to go into differentiation between UK or continental Europe. But in general, they have treated our societies with a white glove, and they were, to a certain extent, fearful of the reactions and motions of our electorate. And in that sense, specifically in the last, for example, five years, we've been in a full-fledged hybrid warfare, which was part of the decision-making of Russia to start a war on Ukraine. So when Russia started the war on Ukraine, it was not specifically meant only and solely against Ukraine, but it was also meant against the European security order, including UK, including continental Europe. And what did our political decision makers do in terms of societal preparation? Well, I would argue not really much if you consider the reaction of our societies to what's happening now. They cannot process the decision making on the war in Iran. They cannot process the global systemic competition between the United States and China, whether this is real or not. There is a problem about perception of reality when it comes to global geopolitics and geopolitics. And there is a big problem when it comes to the perception of the own role, because everybody is screaming only about the rights, but nobody is paying attention to the responsibility. So that means, and to use a historical parallel from the first Cold War, societies were on the same page as the governments and their institutions. They were fighting in this cold war by other means. And meanwhile, we are even scared of the use of the word war, because to us, war would mean actually conventional war with weapons and with soldiers. And that is what we reduce the word to. So in that sense, this societal resilience starts with the fact that we are in a global gray zone war. that the hybrid form of war is going to be the predominant form because neither United States nor China and Russia want to fight directly against each other. And that means that there is a threshold which they don't want to go beyond, and that is the threshold of the use of strategic nuclear weapons, which, of course, in itself is good news. Now, the bad news is, and this is my explanation why there is no societal resilience, you let your guard off. Because then you think, okay, there is no imminent threat that's linked to conventional warfare. So I don't need to do anything against it. And slowly but surely, I describe this as a that by thousand cuts approach. Our competitors are going to rebuild the global system based on their interests, based on their understanding of norms, of rules, of regulations, of actors' constellations, partnerships, you name it. So the base case here is that the United States is switching to a war economy, China and Russia are already in war economies. We are still these peaceful societies, still riding the wave of when we emerged victorious from the first Cold War, And we are now struggling to shift towards a mindset. And when I say we, I would actually explicitly highlight our institutional and political elites, which have been socialized in the context of peace, rightfully and thankfully, for the last 30 more years. But now they are struggling to switch towards war mindset. And again, when I say war, specifically when it comes to Europe, it is a hybrid, full-fledged hybrid warfare. already taking place. You take the playbook from the First Cold War, by the way it's availablen the internet, as many documents from the time of the First Cold War, so there has been a playbook. o

Rod Whiting: 11:14

Well you may have noticed, Valina, that I'm of a certain age and I was in the military during the Cold War and saw firs thand that very, very dangerous period and certainly I've noticed, and I'm sure many of my ilk have noticed that that playbook has returned with a vengeance. It's probably never gone away, but it's particularly noticeable now. But of course, we now have generations who aren't aware of that playbook that you talk about. And so perhaps don't fully understand or appreciate this term hybrid war or active measures, as I think Edward Lucas likes to call it. So if Britain wanted to become genuinely more resilient across the board, where would you start and who are the exemplars? Whose example should we be following?

Velina Tchakarova: 12:13

Right. So if I were responsible for the British geostrategy, let's say I'm in the team and we try to make sense of what's happening. Now, first point, as I said, starts with realisation, your ability to realise what's happening. the ability to perceive and to analyze and conceptualize and structure the reality as it is. I think it's a major, major game changer because a lot of decision making is derived from normative, wishful thinking. Second, it's a very inconvenient reality, but we have to switch towards war mentality. So from peace to war mentality, meaning first and foremost, prioritization in the field of, meanwhile, not even dilemmas, but trilemmas. Because what is a strategic trilemma affecting UK as well as continental Europe? It's the lack of prioritization in terms of time schedule and in terms of scope of effort and in terms of investment and in terms of long term strategy. when it comes to decarbonization coupled with re-industrialization coupled with re-armament. Or simply put, we want to have the cake and eat it. But something has to give in the equation. So to be very, very blunt, we have to start with re-industrialization. So the first and most critical point is that no respected middle power. UK is a middle power. The whole European Union is a middle power. Canada is a middle power. this is a reality we have to accept it we are not a true political actor collective one or whatsoever there are several global actors that are not just willing to act globally but they have skin in the game in terms of hard power projection and that's it now that means of course re-industrialization recreation of the material base that allows a middle power to act autonomously in strategic areas or in areas where national interest is directly affected. That's a must. Why?

Rod Whiting: 14:28

Why is it so important?

Velina Tchakarova: 14:30

Because industrial security is energy security, is raw materials-based security, is manufacturing security, and so on and so forth. The list goes on. In that sense, this is the first priority. So we start, for example, with strategic inventories. If you remember, we spent decades treating inventory as inefficient working capital because of the mindset of abundance and imminent availability. Yeah. But in this... Just in time. Just in time. And we were focused only on efficiency, and we knew that there would be a replacement. So now in this new context of a global system rupture, inventory itself becomes national resilience. Think, for example, again, to use an example from the global system rupture, sulfur, sulfur acid, ammonia, transformers, magnets, energetic materials, all of these are linked to exposures that we have right now. Because you cannot, for example, implement an energy transition if you are lacking certain raw materials or rare arts for your clean tech. Or similarly, you cannot provide for your food security if you are lacking ammonia or other important components for the fertilizers production. This is how things are intertwined in a rupturing global system and, more importantly, in a bifurcating global system when then, of course, the next issue is that strategic vulnerabilities are located in a competitor that long-term sees you on the plate. long term, even if there is a short-term incentive of cooperation, as we heard from Carney, right? He also talked about rupture and how he would now navigate as a middle power, he will navigate between the United States and China. But I argue that long term, these strategic vulnerabilities that will be created by deepening the relationship with China will be weaponized. So we are also currently living in a context of weaponization of everything. Every single interdependence that we created through globalization is now going to be weaponized, for example, to use it against us as a political impact. Or if a competitor wants to weaken a political decision or a specific initiative, you name it, or a competitor in a specific industry. So third important point is industrial capacity. It's no longer sufficient to just talk about rearmament and filling the defense gaps that have been neglected over the last 30 years because of the peace dividend. It's actually also important to understand that we need manufacturing power, we need industrial base, we need to reconsider the importance of critical industries. And that means, of course, again, this combination of labour, skills, supplying chains, raw materials necessary for the revival of these production lines. And then, of course, finally, we end up with the societal preparedness team.

Rod Whiting: 18:02

Well, look, the things you've described there, you say that eventually these shortcomings, if you like, will be weaponized against us. I think we're already seeing that happen, aren't we? And some time ago, you coined the term dragon bear to describe the then emerging strategic partnership between China and Russia, long before many policymakers fully appreciated its significance, I would say. What did you see back then that others are missing? And how has that relationship evolved since? And crucially, what are people still missing?

Velina Tchakarova: 18:35

Yeah, so that is a major argument. I'm not saying that reality is proving me right, but there are strong signals that point to this direction that this modus operandi of strategic coordination in all systemically relevant domains between China and Russia is becoming real by the day. So it is a very slow process. It started top down. And of course, most analysts were in a denial or were claiming that this could not happen based on historical experience, because China and Russia have never been that close to each other over the time span of the last 250 years. Up until nowadays, there is no historical example that points to this kind of approximation of geopolitical and geoeconomic interests on top of technological entanglement. They do not need to sign any big, big treaties which would, let's say, manifest strategic alliance. So we will not see this happening. We will not have this NATO, for example, based alliance, like a defense alliance. But this is what makes it so dangerous because it's subtle. A lot of it is happening behind the curtains. It has started as a top-down process between Xi Jinping and Vladimir Putin. Meanwhile, if you take a look, and I started watching very closely and meticulously this relationship because of a specific event. At that time, if you remember, the event was the first invasion of Ukraine. And many don't remember at the time because a lot of the newly mined Russia experts were not Russia experts at the time, right? Remember, the first invasion was a nothing burger to political elites, which, okay, introduced sanctions and everything, but they were simultaneously inclined into reviving the relationship, Just to give one example, Nord Stream, I think, is the perfect example to prove my point. And in that sense, many analysts just overlooked this specific dimension of the strategic alignment, where China basically stepped in and saved the Russian economy, especially in the period 2014-2015, when the Western isolation was happening, the sanctions packages were introduced, not of the scale as nowadays, but still at that time quite severe. And the currency, the Russian currency was struggling. And guess who stepped in and saved Russia internationally in terms of diplomatic messaging, in terms of messaging to investors that China will prevent any potential default or any crash of the Russian currency? And the rest is history. So, of course, the most natural thing to happen is a denial, That it's not that serious, that it's not a real thing, that denial or making it kind of irrelevant for global affairs.

Rod Whiting: 21:50

And yet some analysts believe that it's a very one-sided relationship and Russia has nothing to offer China.

Velina Tchakarova: 21:56

And yet think about it. If it were not for Russia, how would China be able to become an Arctic power? Why is China now building complete alternative commercial and military supplying chain in the north, in the Arctic? And when I say alternative, of course, what I mean is alternative to the U.S. controlled Indo-Pacific supplying chain connecting Europe via the Gulf to South and Southeast Asia. It's a reality. We should be mindful of it. We should understand that, especially in the field of hybrid warfare, what Russia is doing on the European security order is what China has been doing since 2022, by the way, on South China Sea, East China Sea, and on Taiwan. and this dead by a thousand cuts approach is much slower in duration. It's much more subtle, but this is what makes it so dangerous because nobody would define it as a war. But I argue that this is the war. This is what's happening because I am being asked this question, will there be a military attack on Taiwan, for example, by China? And I say, but there is a war already happening and the Indo-Pacific is already in the worst phase of militarization. Europe is already in the worst phase of war, by all definitions, since 1945. Conventionally, the worst case since the First World War and in hybrid warfare terms, the worst since the end of the Cold War. That's it. And then project it to the other geographies and you get the idea. You get what's happening and why, in fact, it is important to try to adapt our perception senses and to understand their motivation and their mindset. What's at stake? What they want to achieve? What's the outcome they want to see?

Rod Whiting: 23:57

Interesting. So you've talked about Europe there. We've talked about Ukraine. Let's get into that a little bit more. Ukraine has inevitably dominated the European security debates, certainly since 2022, but as you argue, quite a bit earlier than that. We now seem to be entering a particularly dangerous phase of that conflict, and this seems to be a real inflection point. We've just seen the CIA director, John Ratcliffe, make a rather conspicuous flying visit to Moscow. How concerned should we be about Ukraine and our level of preparedness?

Velina Tchakarova: 24:37

Well, let's start with our level of preparedness. We should be very, very concerned. That's my base scenario, because we are not prepared in terms of conventional deterrence, in terms of withdrawal of the United States from the old continent, which has been a trend that we were all aware of and still decided to not act against or prepare accordingly. And when it comes to Ukraine, there are currently two groups of analysts, one claiming that Russian attack on NATO country, for example, in the Baltics is imminent. And then there is a second group of analysts that is not so convinced that this would be the next step. And I tend to be more in the second group. And I will explain why, first and foremost, because of what I already outlined. when you are already in a context of full-fledged hybrid warfare, so you've practically used all means of hybrid warfare, and you can still escalate it in the context of plausible deniability. That means that you will do it while expecting that there will be no consequence. For example, in terms of chain of reaction within NATO, or chain of reaction within Europe, Chain of reaction within NATO would be Article 5 activation. Chain of reaction within the European Union would be activation of Article 42. So why would you, in fact, go into the next stage? And why would you explicitly and deliberately trigger any political decision-making, any institutional decision-making? And here the first group argues, well, to show that NATO has become obsolete. There will be a window of opportunity this autumn because of the external pressure of the global system rupture on the political decision-making in Russia as well as on the political decision-making in Ukraine for different reasons to come back to the negotiation table. The foresight is that there will be a window of opportunity does not mean that we will see successful negotiation process. I'm just saying that right now, because of external variables, there is going to be this window of opportunity. And on top of that, even if we, let's assume best case, end up with some sort of agreement, I argue that it will be more as an armistice, something similar to North Korea, South Korea. And remember, this was the first proxy war in the first Cold War in 1953, still not politically settled. 70 years later. So just giving you ideas. And of course, that is derived from the plausible explanation that no military breakthroughs are possible in the summer offensive on behalf of Russia or on behalf of Ukraine. And simple as that. So this stalemate situation is leading into another severe winter. And if you combine it with the second proxy war and the external pressure coming from the global multiplicative effect, you see how this pressure is now piling up. It's leading to a certain reality, which means that they will not act out of conviction, they will act out of reality. Okay, so now going back to this visit and going back to what's happening in terms of an attack, are you going to attack by conventional means while you are already facing a reality of stalemate in Ukraine and at the same time overheating war economy, recessionary scenario for your country, even with this short break because of the growing demand for oil and gas, even this could not make things better. Are you going to attack NATO country conventionally to set the stage for even bigger reaction on behalf of Western countries because they will have to do something, no doubt about it. And so that means that I don't buy the whole NATO is obsolete thesis because they will have to do something and there will be countries, trust me, especially along the eastern flank of NATO that will react to that. So even if, let's assume, there will be no collective response by all members. There will be partial response by those that see themselves most affected. And in that sense, do I want to trigger such chain of reaction ahead of the new winter? Or do I want to create the impression that I want to trigger, which is the psychological warfare, which actually is the modus operandi of the Russian Hebrew warfare. Similarly to what they did with the use of threat. So they threatened to use nuclear weapons, but they never intended to really use them because the bonus from the psychological effect on societies, on political decision making, is much bigger as compared to the one and only use of tactical nuclear weapons, which would then have created a very different environment for the main supporters of Russia, such as China and India, which are in a rivalry and are nuclear power. So you clearly see how much more complicated the whole thing is than just to reduce it to a single response. And I don't think that anybody, including myself, has a straightforward answer. But I would argue that probably what they discussed was duration, readiness to restart negotiation. I would argue that this was one point, because something has to give. There must be some certain concessions on both sides for the negotiation process to restart. Remember, before the war in Iran, there was a first launch of trilateral meeting between the United States, Ukraine, and Russia. And then Iran happened, and of course the whole process was sealed off. But now there are signals coming from Ukraine, signals coming from Russia, and of course Russia has to play this image of being a strong villain. They should not create an image of a peacemaker now. Of course they have to play these nasty games with our societies, no doubt about it. But I think that one point is how to restart the negotiation. One point is, of course, about concrete Russian threats and to clarify them to avoid miscalculation. And maybe also to get the message delivered that the United States will act, especially on the possible use of nuclear weapons, tactical nuclear weapons, or on an attack of a NATO member. And then the third point, of course, is the intersection between the two wars. Russia is also providing material support for Iran. Let's not forget that. Intelligence and so on and so forth. So the wars are interlinked. And in that sense, I think these were the conversations between the CIA director and the SER director. There was no direct meeting with Putin rather than what is now being speculated in the public space.

Rod Whiting: 32:14

Understood. Look, we've talked about Ukraine. We've touched on the Middle East and the growing strategic competition between the world's major powers. For many people, all of this talk about, you know, war and the risk of nuclear, etc., can all feel rather overwhelming. Most people don't spend their lives thinking about geopolitics, as you and I probably do, without frightening people unnecessarily. What should governments be doing now to prepare their societies for this much more uncertain and fractured world, if we're to do the things that you say, and I totally agree, by the way, we should be doing in terms of rebuilding our military, rebuilding our industrial capacity, and combating this fragility that's built up over 30 years of peace dividend? What should they be doing to get societies more on board?

Speaker: 32:49

Well, you are really asking the hardest question at the end of our conversation. I honestly don't want to be right now in the position of governmental representative or institutional representative facing this reality, knowing and understanding the limitations, especially on the side of society. But then again, I have to remind our audience of the fact that we as a collective West have won the first Cold War. And it was an interplay between governments, institutions, companies, industries, and society, first and foremost. So once again, this will be the case now. Now, the problem is that many political representatives are meanwhile fearful of the emotions and reactions of the electorate. As simple as that. and they decide that it's better to spare people of certain realities, of explaining certain geopolitical or geoeconomic situations, because they are fearful that society will not be able to comprehend or react accordingly. And I think that this is a mistake. I think that this treatment with the white glove should stop. And our decision makers should be extremely honest, brutally honest with what's happening right now. They should start with what they got wrong and how they are intending to improve it, because they got a lot of it wrong. Starting with the Russian war on Ukraine. Remember how most of the governments were wrong? They were wrong up until the beginning of the war. And then many of them went publicly and said, I'm sorry, I was wrong. And then we moved on. And I think that it's a part of this genuine, authentic honesty when you start with yourself, what you saw wrong, and then move on with the concrete agenda you have, how to bring about change. Specifically, we are in a situation of make it or break it moment for Europe. Altogether, I do not separate between UK or continental Europe, meanwhile. We are in a make it or break it moment where it will require a civilizational effort on behalf of everyone to adapt to this new reality. And it's real. So that means that we don't have the luxury of waiting for another five to ten years to see whether it will manifest. This strategic passivity, which is this frozen state where you are standing on the beach and looking at the tsunami coming at you and you are not able to move, is the most dangerous mindset and modus operandi. And I would start there. I would start with this kind of honest conversations at the one that we are having right now. And I would start with the public communication. And then I'll move to our, of course, institutions where we have great people in all the institutions and in all the different sectors. We have great companies and nobody's listening to them as neither, right? What their needs are. We're just imposing new rules and new regulations without actually making the effort to listen to their needs, to their threat perception, to their risks analysis, and how they are immune, the corporate clients I have, and they come mostly from Europe, they have already started adjusting to the new bifurcation of the global system long before the reality manifested itself because they understood that strategic passivity is a slow that. And that's where I would start. I would start with these honest conversations. I would start with public debate. I would start with pressuring. I would start with trusting our societies more that they are able to absorb and able to understand the severity of the situation.

Rod Whiting: 37:25

Velina, a fascinating conversation. Thank you so much for your time, Valina Tchakarova. Yeah, some hard decisions to be taken for all of us, I think. Thank you once again for your time and thank you for listening to Fault Lines.