2016 has been a happening year for the world so far. World is facing economic, financial and geopolitical risk. Economic Intelligence Unit (EIU) has issued an index for global risks and included Trump’s presidency in it.
Governments across the world are trying to solve the puzzle of slowing growth, financial markets are grappling to find stability, and also the geopolitical crises facing them. Here are the global risks according to EIU,
Slowdown of Chinese economy
According to EIU, if China’s economy slows more than anticipated, it will result in more slump in global commodity price especially of oil and metals, which will have detrimental effect on those Latin American, Middle Eastern and Sub-Saharan African states that had benefited from the earlier Chinese-driven boom in commodity prices.
New cold war sparked by Russia
Russia is currently involved in conflicts in both Ukraine and Syria (although it has scaled back its presence in Syria in recent days) and the EIU says that East-West relations are now at their “chilliest” since the end of the Cold War in 1991.
Emerging market debt crisis
The EIU warns that volatility in currency markets could lead to a major debt crisis in the world’s emerging markets.
Fracturing of European Union
Several factors, including the continuing debt crisis in the Eurozone, stagnant economic growth, and arguments over the continent’s refugee crisis have all led to fears about the weakening of the European Union. Should the EU begin to fragment, the consequences could be dire.
Greece leaving euro
At points in 2015, it looked almost certain that Greece would be forced to exit the euro as it struggled to repay loans owed to the IMF and ECB. That imminent threat seems to have passed, but Greece leaving the single currency still remains highly possible.
Donald Trump becoming President of the USA
His aggressive stances on everything from immigration to the American economy have sparked anger from many Americans and split the Republican Party. Fears abound in some sectors of society that a Trump presidency could be disastrous.
Rise of Jihadi terrorism
The group has conquered large swathes of Iraq and Syria, where it is imposing a brutal regime on citizens. ISIS’ growing influence in the Middle East is a huge risk to global stability.
Britain voting to leave EU
Brits go the polls in June to decide on whether the UK would be better in or out of the European Union. Leave campaigners argue that a so-called Brexit would return sovereignty to the country, while those in the Remain camp say that leaving the EU would essentially amount to economic suicide.
War in the South China Sea
Tensions in the South China Sea which center around a group of islands claimed by China, Vietnam, Malaysia, and the Philippines have escalated in recent years, with the USA’s involvement helping to stoke ill-feeling, which could eventually lead to a full scale conflict.