Time Magazine - January 16th 2017 - By Ian Bremmer
The Inauguration of Donald Trump on Jan. 20 is set to bring to an end the 70-year era of Pax Americana, when U.S. hegemony in security, trade and the promotion of values provided stability for the global economy. In its absence, the world will fall into a deep geopolitical downturn. With that as a backdrop, here are my top eight political risks for the coming year:
The top global risks for 2017, a year of geopolitical recession
1. UNPREDICTABLE AMERICA
The world's sole superpower is now a wild card. President Trump will use U.S. power primarily to advance U.S. interests, forging a more hawkish, and less predictable, foreign policy. Allies in Europe and Asia will hedge. Rivals like China and Russia will probe for weakness.
2. CHINA OVERREACTING
The sheer number of places where U.S.-China tensions might play out—North Korea, Taiwan, Hong Kong, the East and South China seas—make 2017 a dangerous year for China, and all who depend on it for growth and stability.
3. A POWER VACUUM IN EUROPE
Though Angela Merkel is likely to win re-election as Germany's Chancellor in 2017, she'll emerge as a weakened figure. This will leave Europe with no strong leadership at all, at a time when strong leaders are badly needed.
4. A PAUSE IN ECONOMIC PROGRESS
Don't expect a surge in needed economic reforms in 2017. India and Mexico have accomplished as much as they can for now. In France and Germany, reform will wait until after coming elections, and China faces an all-consuming leadership transition in the fall. In Brazil, Nigeria and Saudi Arabia, ambitious plans will advance but fall short of what's needed. The year 2017 will be pivotal for Chinese President Xi Jinping
5. TECHNOLOGY DISRUPTING THE MIDDLE EAST
Technological change is further weakening an already fragmenting region. The revolution in energy production undermines states still dependent on oil and gas exports for revenue, while new communication technologies enhance the ability of angry citizens to find like minds and to organize.
6. CENTRAL BANKERS GET POLITICAL
Trump may use the Federal Reserve as a political scapegoat, piling pressure on future decisions. This isn't just a U.S. risk. Britain's Theresa May has blamed the Bank of England for exacerbating income inequality, and German Finance Minister Wolfgang Schäuble says low interest rates have acted as a disincentive for reform among E.U. states.
7. THE WHITE HOUSE VS. SILICON VALLEY
When it comes to technology, Trump wants security, control and new jobs. The tech giants want freedom, privacy and more automation. There will be plenty in 2017 for them to fight over.
8. TURKEY'S ONGOING CRACKDOWN
President Recep Tayyip Erdogan will likely use a referendum to formalize his powers, and tighten his hold on the judiciary, bureaucracy, media and even business sector. This will exacerbate the country's economic problems and worsen relations with Europe.