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.
Demographic change stymies growth not just in Japan
The short history of economic growth has made a handful of Western nations, later joined by Japan, remarkably rich and powerful. Until recently, it seemed that the fast-growing developing countries led by China were poised to catch up with the advanced economies by the middle of this century. Now, the macroeconomic data suggest that they may grow old before they get rich.
The Northern Triangle in Central America
Central America’s Northern Triangle states – Guatemala, Honduras and El Salvador – have become a thoroughfare for illegal migration and drug smuggling to the United States. The U.S. is trying to stop this tide by funding police and judicial reform and setting up watchdog agencies. Progress in this diverse and poorly governed region has been mixed.
The falling yuan: implications for China’s economy
In July 2016, the yuan dropped to its lowest rate versus the dollar since 2010. What does this development mean, and what can we expect for the future, given Chinese ambitions to present the yuan as a strong and reliable international currency? In order to make any predictions, it is necessary to know what the authorities in Beijing will do to address the current problems of the economy as a whole.
China’s slowdown could bring environmental benefits
Beijing is eager to use China’s economic slowdown as a means to improve the country’s environment. The slower growth gives the government maneuverability to address some of the country’s most pressing environmental problems. Nevertheless, doubts remain as to whether authorities are truly committed to green issues or are merely saving face. Lacking rapid economic growth to appease the populace, the government must address the other concerns, such as the environment.
Debt, violence risk instability for Mozambique
The revelation of billions of dollars in secret debt and a resurgence of violence have plunged Mozambique into a two-pronged crisis that puts President Filipe Nyusi between a rock and a hard place. With the country’s renewed instability threatening a slide into civil war, Mr. Nyusi is under pressure to work out a lasting peace with his party’s political rivals. It may be the only way to lure international donors and investors back.
Oil prices: headed for a Goldilocks scenario?
Oil prices are headed for a sweet spot between $50 and $70 per barrel that would benefit key geopolitical players, including Europe, China, India and Russia. Market forces may keep them there. The result would be faster global growth, unless political conflicts intervene.
Russia’s pivot to China: a bridge to nowhere
For Moscow, strategic partnership with China was supposed help put wind in Russia’s economic sails – in particular through diversifying its exports and improving its economic footprint in Siberia. More recently, this “pivot to Asia” is also being used to balance off the West politically, after the war in Ukraine ratcheted up tension between Russia and NATO. The problem is that China refuses to see things quite the same way.
India’s push for land reform needs people power
Poor property records have proven a major obstacle to economic development in India. Their slipshod quality leads to property disputes, corruption and social problems. Numerous Indian government initiatives to digitize these records have had mixed results. But authorities will have to look beyond IT solutions – empowering citizens and eliminating high transaction costs will be necessary.
Brexit reveals grim outlook for EU
The United Kingdom’s vote to leave the European Union has rattled the continent and the world. To be sure, the impact on the UK will be huge. But the EU stands to suffer much more, as Brexit saps its ability to deal with current crises and emboldens nationalists in other member states. Without visionary leadership, the bloc’s prospects are bleak.
Indonesia gets tough on the South China Sea
Indonesia is showing signs of dropping its carefully maintained bystander status in the South China Sea disputes. In response to recent Chinese incursions, President Joko Widodo flew to the Natuna islands to confer with his cabinet aboard a navy corvette. More tensions are in store as Beijing tests his resolve.