FX.co ★ Top 10 global risks for 2021

Divided America

Experts at Eurasia Group consider events related to the election of a new US president.to be the main risk of 2021. Joe Biden's presidency "opens the era of the asterisk presidency, a time when the occupant of the Oval Office is seen as illegitimate by roughly half the country." Incumbent US President Donald Trump has made allegations of unfair voting. Analysts think that by doing that Trump undermines faith in fair voting. In the future, many Americans may consider every head of state illegitimate. The Eurasia Group believes that Joe Biden will try to restore America's leading position in the international arena. Although the Biden Administration is doing everything to restore the position of the US as a global leader, they may fail on this mission due to the polarization of opinions and the inability to cope with internal crises.

Long and even COVID-19 recovery

In 2021, the coronavirus pandemic will threaten not only the lives and health of people but also political stability and the global economy, experts at Eurasia Group believe. It will be difficult for states to keep up with ambitious vaccination schedules. "Though various vaccines have spurred hope globally, the report suggests that the rollout of vaccinations itself will cause problems throughout 2021, along with staggering public debt and the displacement of workers." The distribution of vaccines may divide citizens as some will be able to afford a vaccine while others will not. Such a gap in income and lack of access to a vaccine are sure to stir public anger and unrest around the globe.

Competition over climate change

The study states, "in 2021, climate will go from a playground of global cooperation to an arena of global competition. The result will be an already fractured world drifting further apart." As many countries are committing to carbon neutrality by the middle of the century, some may see it as a great opportunity to attract private capital. Political factors will play a crucial role in this issue.

Escalation of trade tensions between US-China

"Despite the new American presidential administration, US-China relations will remain tense in 2021, as the two global powers will have "a competition to heal the world, and another to green it," analysts highlight. Besides, relations between the two countries may worsen against the background of rivalry over vaccines as well as high technology. However, many traders are ready for it taking into account long-term disagreements between countries.

Global reckoning over private data

In 2021, free sharing of information from one country to another may be hindered by an increase in the costs of companies. As a result, it may lead to some technical failures in popular applications. The governments of a number of countries that aim to gain access to their citizens' data will only aggravate the situation. Yet, such a move undermines the concept of an open Internet, experts say.

Confrontation over cybersecurity

Many countries have long been concerned about the vulnerability and lack of control of the digital space. However, excessive interference can only deteriorate the situation. 2021 may become the year of prolonged cyber conflict, which increases the likelihood of technological and geopolitical risks.

Economic turmoil in Turkey

In 2021, the Asian region will also face many problems. President of Turkey Recep Erdogan will have to fight for the votes of disillusioned voters tired of economic difficulties and ineffective fight against the coronavirus. According to analysts at Eurasia Group, Erdogan’s current policy may inflame nationalist sentiments. However, the president should not count on foreign help. He will have to extinguish the conflict on his own.

Growing tensions in Middle East

The current year will be especially challenging for the states of the Middle East and North Africa. Last year, oil-producing countries faced a collapse in demand and a sharp drop in revenues. "As the COVID-19 pandemic decreased the world's energy consumption, some countries in the region experienced the dual financial toll of the pandemic and reduced energy-related income, and will continue to reel from the two forces well into 2021," the agency warns. Governments in the Middle East will have to cut spending, which could hit private businesses. At the same time, the unemployment rate will increase significantly.

Merkel’s resignation

The main risk for the eurozone may be the decision of Angela Merkel to leave office. According to the report, "Merkel has been Europe's most important leader," and her departure poses a significant threat to the continent, already facing the fallout of intensified lockdowns in some countries, among other fiscal concerns. If her successor is unable to cope adequately with the current challenges, the economic situation in Europe will be in dire straits.

Potentially provocative news of mass media

Analysts at Eurasia Group fear that tactics used by mass media to create hype may create risks in 2021. These are issues that are actively covered in the media, which provoke instability but do not pose a threat. For instance, the media creates a lot of hype over future politicians from the Trump administration. With Joe Biden in the office, relations with President of Turkey Recep Erdogan, British Prime Minister Boris Johnson, Brazilian President Jair Bolsonaro, and Israeli Prime Minister Benjamin Netanyahu may worsen considerably. Additionally, a number of media outlets noted that in 2021, large US technology companies would suffer huge losses. However, experts at the Eurasia Group have a different opinion. On the contrary, they are expecting the tech giants to steam up their activity and reach new peaks. Besides, Eurasia IT companies are likely to become the engine of post-coronavirus recovery.