A brief post-Cold War sense of humanitarian obligation to try to solve the world's problems has begun to give way to colder realpolitik calculations of what can be done. In future, "coalitions of the ready and willing will only be made up of the relevant and affected."
In its annual Strategic Survey, published yesterday, the Institute noted, with concern, that national elections in France, Israel, Japan, Russia, Taiwan and the US all interfered with clear foreign policy choices during 1996. In 1997, the same thing happened in Britain.
"In their search for votes, or for support, leaders vying for the top position adjusted their policies to reflect what they thought their constituents wanted. Almost inevitably, this did not include foreign issues."
Institute Director John Chipman, launching this year's Survey, said that in spite of efforts to organise common foreign and security policies, western countries are reverting to a position where they will act only when they see a clear interest that can be explained domestically.
For western countries the absence of an obvious external threat reinforces their introverted tendencies.
While US provincialism has a long tradition, the survey says, European parochialism took on a new mantle in 1996. The Institute concludes that "while the 'under construction' signs were up, the Europeans barely lifted their gaze above their own ramparts."
With Europe dragging its feet the onus was, as ever, on the US to lead in world affairs. But the US, again, saw everything through domestic lenses, delaying the admission there would be a follow-on force in Bosnia and attacking soft targets close to home like companies which tried to do business with Cuba.
Russia, too, saw things through domestic eyes - particularly the key issue of Nato enlargement which was used much as Britain's political parties used that of Europe, as a tool for domestic political confrontation.
"The events of 1996 overwhelmingly showed," the Institute concludes, "that no state, including the US was immune from foreign meddling in domestic affairs or domestic meddling in foreign affairs. The distinction between foreign and domestic is becoming thin and the net result is more incoherence".
In Russia, the institute notes a decline in industrial production, a deteriorating military, and a profound criminalisation of politics and economics. Yet the institute is surprisingly optimistic. "This is not a time of troubles in the classic sense ... there is no tyrant waiting in the wings, nor could one impose himself on a population that is now half- free."
Dr Chipman said China was an "assertive" power, rather than a directly threatening one. "China veers from excessive confidence to paranoia about its ability to prosper free of foreign constraint. The debate about how to handle China has become one of the central issues in international relations."
The survey identifies an "arc of conflict and crisis" in Africa, illustrated as running from the Red Sea through southeast Sudan, across the whole of Rwanda and Burundi and most of Zaire, and embracing the northern part of Angola.
The survey says the international community is gradually, but significantly, disengaging from Africa.
"The test of whether the West can maintain its indifference will come if Zairean President Mobutu Sese Seko is deposed and the country collapses. Should the West allow it to descend into chaos without attempting to shore up a reasonable, unifying government, there will be little hope for any other African country facing an uncertain future".
t Strategic Survey 1996/97, (Oxford University press for the IISS, London, 1997), pounds 25/$39.