Coming Soon in Our September Political Risk Reports
PRS’ coverage of the Americas this month includes updates on Cuba, El Salvador, Paraguay, and the United States, where the rival Republican and Democratic parties are gearing up for mid-term congressional elections that are likely to deepen political dysfunction in Washington, regardless of the results. The report will examine what the Democrats’ anticipated loss of control in at least one chamber of the Congress will mean for policies affecting the business climate and the various risks stemming from the brinkmanship and dysfunction that has been the norm during previous periods of divided government. PRS will also discuss the potential for the deepening legal troubles of former President Donald Trump to reinforce partisan mistrust in state institutions, a prospect that has implications for both the security threat posed by militant far-right groups and commitment to the rule of law more generally.
As well as fully refreshed reports on Austria and France this month, our coverage of Western Europe includes a timely update on the current situation in Greece, where the center-right New Democracy government led by Prime Minister Kyriakos Mitsotakis has less than a year to run on its mandate but is coming under increasing strain on account of the country’s economic problems and a spying scandal souring the political atmosphere. As well as teasing out the various implications of what seems to be an enveloping scandal targeting opposition MPs and journalists that has already led to the country’s head of intelligence resigning, we also look into the latest tensions developing with Turkey with the two NATO members at loggerheads over territorial claims and Ankara threatening to challenge the sovereignty of small Greek islands close to Turkey’s coastline that it claims Athens is militarizing. Our report goes on to investigate the implications of rising energy prices, and the government’s response by extending subsidy payments paid for by tourism revenue, while also assessing how high inflation and a deteriorating global economic climate generally are likely to impact on the country’s much-improved growth, unemployment, and fiscal trends in recent years, notwithstanding the temporary disruption caused by the pandemic.
Coverage of Eastern Europe will include a report on Poland and an in-depth analysis of how the military invasion of Ukraine has and will continue to affect political risk in Russia, where President Vladimir Putin is signaling his continued full commitment to the military campaign, despite a concerted effort by the west to punish the Moscow regime for undermining peace in Europe. The report will examine the implications of Russia’s relegation to pariah status for both political and economic stability in the near term, including the possibility of sovereign default, and how the Kremlin’s attempts to manage the twin crises could shape Russia’s role in the global economy over the longer term.
Turning to the Middle East and North Africa, our coverage in September will feature a report on Iran, which continues to bargain hard with the US in talks aimed at reviving a 2015 nuclear agreement and securing the removal of sanctions that have long hobbled the nation’s economy. The recent surge in global prices for oil and gas has generated a minor windfall for Tehran, but increased competition with Russia for customers willing to do business with pariah states is preventing Iran from reaping the full benefits of the boom. The report will assess the likelihood of a diplomatic breakthrough, as well as the implications for both domestic and regional stability if negotiations fail to produce an agreement, and what either of those scenarios would mean for foreign investors.
Over in sub-Saharan Africa, this month we feature two smaller updates on Malawi and Sierra Leone, along with more detailed analyses of the risks in fellow cocoa producers and neighboring states, Côte d’Ivoire and Ghana. Our report on Ghana in particular looks at the prospect of a full-blown debt crisis in light of the country’s mounting economic problems, weighing on the currency and resulting in credit rating downgrades. We assess what that would mean for political and social stability in the wake of recent protests highlighting the daily struggles with high unemployment and the soaring cost of living, now with annual inflation going past 30%. Our report looks at the pressure President Nana Akufo-Addo’s government is under, with such a slim majority in Parliament, as hardship increases and in the light of an opposition probe into alleged pilfering of Covid-related funds donated by multilateral organizations. We also look into the government’s policies and what it intends to do to ameliorate the economic issues that are developing, not least to gain the support of the IMF for desperately needed budget financing, to shore-up foreign exchange reserves and restore confidence in a weakening currency that is making matters worse.
In East Asia and the Pacific, this month we cover South Korea in detail, along with Japan, where seemingly nothing has stopped the yen from depreciating to new lows against the US dollar. Our report delves into what is causing the former safe haven’s demise, and whether it can realistically continue. We compare the Bank of Japan’s monetary policy with that of the US Federal Reserve’s and assess the economic and currency effects of officials dispensing with PCR testing rules for COVID, shortening the isolation period, and fully reopening Japan’s borders, which should restore foreign demand for currency.
Our report also looks in detail at the various policymaking choices facing the Liberal Democratic Party-dominated coalition in light of the partial upper house elections that were held in July, and against the huge shadow cast by the fatal shooting of the long-serving former leader Shinzo Abe. Our report highlights the internal political debates that are forming over Fumio Kishida’s desires to restart Japan’s idled nuclear reactors to ensure energy security, despite memories of the Fukushima disaster just over a decade ago. We also look into measures aimed at addressing the rising cost of living and pay attention to Japan’s foreign policy interests, notably regional relations given the diplomatic spat with South Korea in recent years, the seemingly intractable North Korea problem, and China’s pressing threats towards Taiwan.
Since 1979, The PRS Group Inc., has been a global leader in quant-based political and country risk ratings and forecasts. This commentary represents a sneak peek from our upcoming political risk reports. For more information please contact us at (315) 431-0511 and email@example.com, or explore a subscription to ICRG Online and/or World Service Online today to receive political risk updates.
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