Growth, recessions, fiscal policy, monetary policy, currencies and global business deals. GIS experts provide forecasts and potential scenarios for all of the economic trends that shape geopolitics.
President Trump’s impact on Latin America
We do not know how much Donald Trump does not know about Latin America. If he keeps his campaign promises, the U.S. economy could suffer as much as Mexico’s or Brazil’s, and illegal immigration could get worse. A lot will depend on the new president’s learning curve.
Italy: populist Five Star Movement lurks in the wings
By calling a risky referendum on his constitutional reform, Italy’s Prime Minister Matteo Renzi has put in jeopardy not only his government and the Democratic Party’s political future. Should the prime minister’s gamble backfire, Italy’s populists of the anti-capitalist Five Star Movement may be the ones forming the next cabinet.
The future of OPEC
OPEC's influence in the global oil market has greatly diminished in recent years, mainly due to the shale revolution in the United States, but also because of diverging interests among its members. It has pledged to cut production, but doing so may prove difficult. There are still some scenarios where OPEC could rise to prominence, but the most likely scenario is for it to be further marginalized.
China’s influence in Southeast Asia flows through the Mekong
China is using the Mekong as a geopolitical tool. The river provides much needed irrigation water and hydropower potential to countries downstream, but Beijing can choke the flow with a network of 20 planned dams. If the downstream countries joined together, they would have a chance of preventing China from using strong-arm tactics. As it stands however, each country is dealing individually with the Chinese, ensuring Beijing has the upper hand.
Iraq: OPEC’s wild card
Though OPEC agreed to reduce production at its September meeting, Iraq is resisting, arguing that the data used to determine the cuts is wrong and that it must continue producing to keep its economy afloat. If Iraq wins an exemption, other countries could follow, forcing OPEC to try for a bigger reduction. That will only happen if Saudi Arabia agrees to take on the lion's share of the cuts.
Domestic considerations drive American politics
Domestic concerns alone propelled Donald Trump to victory in the U.S. presidential elections and they will increasingly guide Washington’s policies internationally. Recognizing this is key to understanding how the U.S.’s role in the world will change.
Japan is trying another fiscal stimulus to make Abenomics work. The central bank appears to have given up, admitting in its latest quarterly report that monetary measures will not suffice to get inflation back to the 2 percent target. But the real culprit may be institutional inertia, which has kept the government from following through on promises of structural reform.
The next Greek bailout (or not)
As Brussels and Athens prepare for new negotiations on the Greek debt in 2017, another flawed bailout deal is on the cards. Neither side is ready to act on the knowledge that Greek public finances are still unsustainable. Postponing the day of reckoning through debt monetization might be the most that the EU leaders can achieve at this juncture, but even that is uncertain.
Growing cities pose challenges for African economies
Africa’s future is tied to its growing cities. However, in most of them, economic resources are not keeping pace with the speed and scale of urbanization. Unprecedented population growth, huge infrastructure gaps, a lack of investment and poor governance pose challenges to sustainable development.
Bangladesh faces threat of sectarian violence as leaders jockey for power
Forty-five years after Independence, Bangladesh stands at the edge of the precipice. Restoration of democracy in 1991 has spurred economic and social development, but these gains are being undone by violent religious fundamentalism. Two formidable women, the leaders of Bangladesh’s main political parties, are using these radicals in a proxy war that could cost the country its “democratic dividend.”