Special edition: Spotlight 2017
PRIS is delighted to present its first annual forecast report focused on the major political risks of 2017.
Overview: The End of the End of History
When Francis Fukuyama infamously proclaimed the ‘end of history’ it was against a backdrop of tumbling walls and spreading democracy and capitalism. With the triumph of Western liberal democracy and market economy over the tyranny of communism, the thinking went, there was no looking back. The globe was about to be completely submerged by the ‘third wave’ of democratisation, national borders will gradually fade away and ethnic and political conflicts will become a relic of the past as they morph into benign economic competition between firms and individuals.
2016 dealt a major blow to that theory. Indeed, last year has left Fukuyama’s vision of a borderless, globalised world in tatters. Walls are back in fashion. Anxiety about sluggish economic growth fused with fears about terrorism and migration has led to a surge in right-wing populist and ethno-nationalist movements in Europe and the United States. With globalisation and its apostles in their crosshairs, they pushed Britain outside of the European Union and towards an uncertain future, and then the US to the shock election of Donald Trump. Beyond the West, illiberal sentiments continued to proliferate and authoritarianism to take hold from the Philippines to Poland to Hungary and Turkey.
The year 2016, in short, marked the end of Fukuyama’s end of history. The world is no longer heading towards a capitalist, open border Utopia. In 2017 we are entering a period of uncertainty, tectonic change, and the most volatile political risk environment in decades.
In this special report, PRIS members and two LSE academics identify the most salient political risks to look out for in the coming year. Throughout their articles it becomes immediately apparent that the end of Pax Americana and the leadership vacuum that it leaves behind is at the heart of the burgeoning uncertainty. With Trump’s US being concerned with ‘America first’, disengaging from the institutions and norms that have held the post-war global liberal order together thus far, the world, as global democracy expert Dr Brian Klaas warns, will continue to look less democratic in 2017.
The liberal world will not be able to look to Europe for salvation. The EU will be too weak and distracted to take the lead. With elections coming up in France, Germany and the Netherlands, and the threat of additional terrorist attacks looming large, populist movements will continue to be front and centre. Marc Nikolov, in his article, wonders whether additional victories for anti-establishment parties could spell the end of the EU as we know it.
The leadership vacuum will also have serious consequences on the global efforts to tackle climate change, as Sini Matikainen points out. Indeed, the progress towards implementing the Paris Accord, and the impact of Donald Trump’s presidency on US climate change policy, will be significant over the coming year.
With an unpredictable Trump as the US president, Latin America is heading towards a turbulent year as well, writes Francisco Ambrogi. If the new US president follows up on his protectionist rhetoric, Latin America might better off looking eastwards to China for economic partnerships.
The Middle East, Zachary Torrey argues, will continue to be shaped by the Iran-Saudi divide who will carry on with their proxy wars throughout the region. With the US increasingly disinterested, China and (particularly) Russia are likely to step to reconfigure security alliances in the region.
Russia, in fact, is likely to push forward, more aggressively, with its efforts to become an important global player as it forges a friendlier relationship with the Trump’s US. Daniel Fitter wonders, however, whether Trump and Putin will be hamstrung by domestic politics in their respective countries.
Finally, though investing in Africa will continue to be a risky proposition in 2017, African countries are showing a strong commitment to investing for a better future for the continent, writes Bernardo da Mata. China and its investments, furthermore, are likely to continue being the most important economic force in the continent.
The centre of gravity, then, will continue to shift eastwards in the coming year and world will be increasingly multipolar. Fukuyama’s Western liberal global order is under a grave threat of being completely undone. With these tectonic shifts afoot, only one thing is for certain: it is going to be a bumpy ride.
With Donald Trump taking the wheel in the United States, Europe too distracted and weak, and Russia keen on supporting authoritarian regimes and in foiling Western diplomatic policy, Brian Klaas, Fellow in Comparative Politics at LSE, warns that democracy will continue its global decline in 2017.
Progress towards operationalising the Paris Agreement, and the impact of Donald Trump’s presidency on US climate change policy, will be significant over the coming year. For investors, risk disclosure and green finance will likely continue to be hot topics of discussion – argues of LSE’s Grantham Research Institute on Climate Change and the Environment.
A Trump administration is planning to make common cause with Russia facilitating a more concerted pivot to the Pacific, but will both Presidents be hamstrung by domestic politics, asks PRIS’s Eurasia Regional Specialist .
With Iran’s position improving and Saudi Arabia’s deteriorating, we should expect both to make important moves in the next year: Iran to press its advantage and Saudi Arabia to desperately attempt to make ground, argues Zachary Torrey. Security alliances, furthermore, are likely to be reconfigured as the US continues its disengagement from the region and China and Russia stepping in to fill the vacuum.
Marc Nikolov argues that 2017 will witness more uncertainty emanating from Europe as the backlash against globalisation and against a liberal, open European Union is rampaging through the continent. Populist anti-establishment parties will remain in the spotlight this year, as several EU Members will be holding elections.
With an unpredictable Donald Trump as the US president, 2017 will be a turbulent year for Latin America, writes If the new US president follows up on his ‘America First’ rhetoric, Latin America might better off looking eastwards.
Though investing in Africa will continue to be a risky proposition in 2017, African countries are showing a strong commitment to investing for a better future for the continent, writes Bernardo da Mata.
