By Ian Bremmer and David Gordon

Amid a sluggish global recovery, China's return to go-go growth will generate plenty of resentment in 2011 -- and not just in Washington. Though China has become the world's second-largest economy, its leadership insists it must continue to manage the country's development at a measured pace. For some of China's biggest trading partners, that argument is beginning to ring hollow.

To rebalance the global economy, policymakers in both the developed and developing world have called on China to reduce its enormous trade surpluses by reducing the country's dependence for growth on exports and increasing Chinese consumer demand, both for foreign and domestically made products. Chinese policymakers would like to do exactly that. The Western financial crisis briefly created turmoil in China, not because Chinese banks were exposed to contagion from Western banks, but because reduced demand for Chinese products in Europe, the United States, and Japan hit local manufacturers hard and forced millions of Chinese from their jobs. Beijing scrambled to create new jobs, primarily by targeting massive state stimulus spending at infrastructure projects that required lots of manual labor. For the Chinese leadership, generating much greater domestic demand would make China less vulnerable to hard times elsewhere.

But China's plans for rebalancing will take a generation to accomplish, and a lot of its trade partners would like to see the change come much faster than that. In the near term, Beijing will offer only small adjustments to accommodate them because the leadership must negotiate demands from various interest groups within the leadership and because this transition will put many more workers on the street than the slowdown did, and the Chinese leadership knows it must manage that challenge carefully to avoid a dramatic surge in civil unrest.

Unsatisfied, outsiders will grouse that China's rate of export growth remains twice its rate of economic growth. In 2010, relations between the United States and China became much more contentious. In 2011, China will likely face increased pressure from Europe, Japan, and probably from emerging markets like India and Brazil. Further, China's security-driven assertiveness in East Asia will continue to provoke tensions with many of its Asian neighbors even as trade relations deepen.

In the past, China has taken the edge off international pressure by adjusting the pace of its reform efforts modestly just before major multinational gatherings -- for example, by depegging the renminbi from the U.S. dollar in advance of the June 2010 Toronto G-20 summit. But there aren't many "steam-releasing" events on the calendar in 2011. President Hu Jintao visits Washington later this month, but the North Korea crisis will occupy much of that conversation, decreasing the likelihood that China will see much value in any major moves on rebalancing.

The next G-20 meeting, this one in Cannes, won't be held until November. French President Nicolas Sarkozy has grand ambitions for this event, but frustration with China will build over the next 10 months and so too will the risks of market-moving international reactions to China's incremental, deliberate, consensus-driven policymaking process. At Cannes, tensions may come to a head as more countries than ever prove ready to confront Beijing on issues from industrial policy to intellectual property rights protections to currency valuation.

On Monday, we'll examine the threat from North Korea, which hits our list of this year's top risks at No. 5.

Ian Bremmer is president of Eurasia Group. David Gordon is the firm's head of research.

By Ian Bremmer and David Gordon

We've now released our annual report on the ten most important political risks for 2011. Over the next two weeks, we'll be discussing each risk in more depth in this space. We begin with a brief overview.

In the past, our coverage of political risk has centered on particular countries, regions, issues, or events. We worry about elections in brittle countries and their ability to generate unrest, military confrontations involving unpredictable governments, or a policy shift with serious implications for a country's business climate and growth trajectory. For 2011, we're focused on a fundamental ongoing change in the global order.

As we step into 2011, headlines in the United States suggest a little more optimism about recovery, but market players and business decision-makers aren't convinced. Gold prices remain relatively high, and trillions of dollars that could be invested remains on the sidelines. Why the caution?

We're entering an entirely new world order with new ways for states to relate to one another, both politically and economically. That problem could provoke new areas of conflict, and it will highlight an emerging vacuum of power in international leadership -- and the uncertainty that comes with it.

We're calling this new order the G-Zero, because no country or bloc of countries has the political and economic leverage today to drive an international agenda. The G-20 helped build a useful crisis response when the financial crisis hit, but as the sense of urgency evaporated, so did the unity. The G7 is an anachronism. The G2 (the United States plus China) won't work, because the United States can't afford to keep up its role as primary provider of public goods, and China (like other emerging states) is much more interested in protecting domestic growth and stability than in accepting new burdens abroad. The G3 (the United States, Europe, and Japan) isn't viable, because Europe is shoulder deep in a bid to save the eurozone, and Japan's government is dysfunctional.

There's no international leadership, and each government will increasingly protect its gains at the expense of others. That's why the dominant economic trend of the last 50 years, globalization, now faces a direct challenge from geopolitics. Governments in both the developed and the developing world have every incentive to throw up barriers to commerce and investment that are designed to protect their own workers and companies -- and no country or bloc of countries has the will or the muscle to reverse this trend.

Our list of risks for 2011 includes the potential for crisis in Europe, tensions at the intersection of cybersecurity and geopolitics, China's unwillingness to bow to a growing surge of international pressure for economic policy changes, provocations from North Korea, and the risk of a spike in currency controls. All these risks are intensified by this transition to a G-Zero order.

Next up, we'll look at the G-Zero in greater depth, because it's our top risk for 2011.

Ian Bremmer is president of Eurasia Group. David Gordon is the firm's head of research.

Most of the press following the recent G-20 summit in Toronto focused on President Obama's inability to persuade Europeans that the global recovery is too fragile for a slowdown in stimulus spending. But the real story was his administration's pledge to move forward on a long-delayed free trade agreement with South Korea.

The Korea-US free trade agreement (KORUS) was completed in 2007, but congressional Democrats, under pressure from labor unions, have refused to vote on ratification. They charge that, among other problems, the deal would allow South Korea to continue blocking entry to American automobiles and beef. Obama said he wants renegotiations to be completed before he visits Seoul for the next G-20 gathering in November and that he intends to submit the deal to Congress for a vote after the mid-term elections. This is Obama's first explicit public commitment to push on a specific trade deal with a clear timeline for passage.

America's 9.5 percent unemployment rate and a very challenging election season might make this a surprising time to try to move forward. But political and security developments in East Asia help explain the timing. China's recent announcement that it will allow some upward movement in the value of its currency has not appeased critics in Congress, and U.S.-China trade frictions will continue. More importantly, the crisis created when North Korea sank a South Korean naval vessel has sharply increased tensions in the region. These developments provide good reason for the United States and South Korea to move closer together. In Toronto, Obama went so far as to describe South Korea as "the lynchpin" of American policy in Asia -- a comment that raised a few eyebrows in Tokyo.

The South Koreans passed this deal long ago and have refused to reopen it to address congressional complaints. But anxiety over what's happening in North Korea will make it easier for South Korean President Lee Myung-bak to argue for compromise and better relations with the United States. The Obama administration assumption is that passage will become easier after the midterms have passed as enough pro-trade Democrats join Republicans to close the deal.

Forward movement on KORUS could add momentum behind other free trade proposals. House Majority Leader Steny Hoyer (D-MD) has argued that trade agreements with Panama and Colombia should move forward at the same time. The move also creates a possible opening for a U.S.-Japan trade agreement framework, something the president will consider more favorably now that new Japanese Prime Minister Naoto Kan is working to improve ties with Washington damaged during the turbulent tenure of Yukio Hatoyama.

The Doha round is going nowhere, but combine the latest moves with a reinvigorated U.S. push for Russia to join the World Trade Organization, and the Obama administration might finally have itself a trade agenda.