We say goodbye to 2023, with several changes on the international board. Along with this, the world faces complex geopolitical tensions with important implications for global stability.
In the previous article, several elections and key events in 2024 were analyzed. However, a more in-depth analysis remains for 2024. This article will shed light and offer a more detailed analysis on what we can expect, segregated by topic and then by geographic regions.
Looking ahead to 2024, the world's regional and strategic outlook introduces a series of geopolitical concerns that transcend geographic borders and affect all people and companies, regardless of their location.
A notable feature of the geopolitical environment in 2024 is multipolarity. As great powers, the EU, the United States and China will continue to profoundly shape the global operating environment. However, middle powers such as India, Saudi Arabia, Turkey, South Africa and Brazil are going to gain more influence on the international agenda.
On a technological level, artificial intelligence (AI) has taken on a more relevant role. Powers such as the United States, China and the European Union (EU) are taking increasingly divergent approaches to regulating technology. Meanwhile, the development and deployment of AI continues at an exponential pace. 2024 will be a key year where we could see greater regulation around AI.
On the economic side, the economy of 2023 has proven to be more resilient than most expected at the beginning of this year. Although a recession is not anticipated in 2024, some economists are bracing for a rough patch, largely as a result of tighter monetary policy that could ultimately slow economic activity.
Last but not least, on the energy front, 2023 remains under pressure from a growing series of geopolitical and economic stressors, including the sustained conflict in Ukraine, growing instability in the Middle East, competition between US and OPEC+ and persistent inflation.
In 2024, the crude oil market in 2024 is expected to be balanced , with a slowdown in demand and a possible price war led by Saudi Arabia. In turn, gas investments are likely to decline following a flood of LNG supply contracts, while nuclear power gains attention as a crucial part of the energy transition.
It is important that we enter 2024 with three hotspots of armed conflicts with global repercussions: Ukraine, Israel-Palestine and the Indo-Pacific region.
1- Ukraine: greater fatigue?
After being a relevant dynamic on the global news agenda for almost two years, the full-scale war in Ukraine will continue in 2024. However, the war will unfold differently.
Ukraine's ability to resist Russia at the start of the invasion, in February 2022, surprised many and became one of the reasons for its international partners to provide it with more weapons. However, in mid-2023, with the results on the counteroffensive, there are increasing internal cracks in the EU and the US over support for Kyiv.
Tied to this rift within the EU and the US What worries Kyiv most is the so-called " Ukraine fatigue ": the decline of empathy and support from the general public in Western states.
It is important to provide two examples. One of them, certain polls in the United States show that the number of those who believe that Washington is helping Ukraine too much has increased from 21% to 41%. In the European Union, in eight out of 27 countries, more people are against providing aid to Ukraine than in favor.
Along with this, delays in the provision of aid from abroad are slowing Ukraine's ability to arm its army, causing growing anxiety in Kyiv and increased confidence in Moscow. It should be mentioned that, in November, the European Union reported that it would not meet its goal of supplying one million projectiles to Ukraine by March 2024.
In 2024, there will be three elections that have the potential to determine what could change: the presidential election in Russia in March, the EU parliamentary election in May and the US presidential election in November. The concrete possibility of a Donald Trump presidency in 2024 creates a lot of uncertainty for Ukraine.
With Donald Trump's potential return to the White House, a more positive attitude toward Russia, a stance echoed by much of the Republican base and some of the party's members in Congress, is likely to reemerge as a driving force for American politics.
These dynamics are going to be key for this phase of a war, which next year will celebrate its second anniversary, with no signs of a solution in the short or medium term.
2- Middle East: the conflict in Gaza under the magnifying glass
On October 7, a heinous attack was carried out by the terrorist group Hamas on Israeli soil. Following this attack, Israel launched a military operation, still active today, in the Gaza Strip.
This attack has reopened and returned the Israel-Palestine or Arab-Israeli conflict to the international stage. If the Arab revolts attracted media attention, the Abraham Accords gave the appearance of a normalization of relations between Israel and its Arab neighbors, while the Palestinian cause seemed to be abandoned. Along with this, the conflict between Iran and its proxies, on the one hand, and the United States, on the other, has also intensified .
This conflict remains strongly rooted in Arab public opinion and a negotiation between Israel and other Arab states, especially Saudi Arabia; It will not be possible or, at least, it will be seriously affected and hindered, without offering a real solution for Palestine.
In the regional environment, the repercussions are multiple, beyond the possibility that the war will expand or the concerns of Jordan and Egypt about a second Nakba and the massive arrival of Gazan refugees. In Lebanon, mired in a serious economic and political crisis, there is a high risk that continued clashes between pro-Iran Hezbollah militias and the Israeli army will lead to a larger conflict.
As for the ongoing civil wars in the region, Libya, Syria and Yemen can be expected to remain largely frozen, but the conflict in Sudan will continue to worsen .
Turkish leaders, aware of the imminent threat to their country's stability and prosperity, are acutely aware of what is at stake. Similarly, Jordan and Egypt are in a precarious economic situation. In turn, Egypt and Jordan in particular will face enormous combinations of socioeconomic and political challenges.
In turn, Israel must be closely watched, where Benjamin Netanyahu and his government are unlikely to survive 2024.
Also, it is important to mention Iran. On the one hand, local elections will be held in the Persian country, amid intense protests triggered by the brutal and unjustified death of Mahsa Amini. On the other hand, the death of Supreme Leader Ali Khamenei raises important and immediate questions about the new leadership and direction of the Islamic Republic and its survival.
3- Indo-Pacific: towards greater regional competition
The Indo-Pacific region emerges as the geopolitical epicenter of 2023, dominating as the largest and most strategically significant area in the world. Surpassing the North Atlantic in trade volume, financial transactions, economic prowess, population and military concentration.
This region faces several threats: economic and military .
The first of them is in the economic aspect. The Chinese economy is in a delicate situation . China's slow response to the impacts of Covid-19 and subsequent slowdown following the pandemic have undermined confidence in its government's ability to communicate and guide markets. This could call into question its ability to weather an economic downturn. If the measures do not work, the Chinese Communist Party could reduce its support for the market economy and exert greater control over the world's second largest economy.
At the same time, on the military level, the confrontation between the United States and China will increase and occupy a central place in the region. China, focused on military expansion, poses a major challenge to US dominance in the Western Pacific, while Taiwan remains a potential flashpoint.
Taiwan will choose between pro-Chinese independence parties and pro-Chinese unification parties, and the likely victory of a pro-independence party could further raise tensions in the South China Sea.
Another point of conflict is in the South China Sea. In the South China Sea, China's hostile actions towards the Philippines are increasing tensions and bringing the Philippines closer not only to the United States but also to other key states such as Vietnam, Indonesia, among others.
In the South China Sea we must focus on an important and little analyzed actor, Indonesia.
Elections in Indonesia, the world's largest Muslim-majority country and a rising economic power, will test its democratic resilience and its role in Southeast Asia. Outgoing President Joko Widodo, who has held the nation's presidency since 2014, will step aside as his term expires. His legacy can continue through the candidacy of his Defense Minister Prabowo Subianto, whose vice-presidential running mate is Gibran Rakabuming Raka, President Widodo's eldest son.
The impact of these elections on geopolitics, global business and society will be enormous, potentially influencing the policies, alliance networks and priorities of some of the world's largest and most influential economies.
Along with these three topics, it is interesting to mention other regional events that will mark this coming 2024.
In Asia, it is important to mention two countries: Afghanistan, Pakistan, India and Burma.
Afghanistan could further destabilize the region in 2024. Chinese, Uzbek and Pakistani insurgents are openly training under Taliban command. Armed resistance to the Taliban government has been limited. That could change in 2024.
Afghan opposition groups that want to restore a democratic republic are beginning to unite. This could change if regional neighbors, particularly Tajikistan, give the groups room to operate.
In turn, Pakistan miscalculated by supporting the Taliban. The TTP, the Pakistani Taliban, has absorbed many smaller groups, and from its Afghan haven emerges a more potent threat. Pakistan's response, which will send hundreds of thousands of Afghan refugees home, will increase bilateral tensions.
Another key state will be India. Prime Minister Narendra Modi is seeking a third term. Modi, who leads the Hindu nationalist Bharatiya Janata Party, has been accused of undermining India's secular and pluralistic traditions, stifling dissent and enacting controversial laws that discriminate against Muslims and other minorities.
Despite these accusations, Modi's popularity remains high among his supporters, who credit him with achieving economic growth, fighting corruption and standing up to China and Pakistan. The 2024 Indian elections will determine whether Modi can consolidate his power and his agenda, or whether opposition parties can mount an effective challenge and offer an alternative vision for the country.
After this analysis of India, it is now important to focus on Burma. The Military Junta faces unprecedented military and economic pressure. China is trying to mediate an end to fighting between the country's ruling State Administration Council and an alliance of ethnic opposition militias known as the Three Brotherhoods Alliance, but must wonder about the junta's long-term viability.
Now we move to Africa. Coups continue to have a huge impact on international investor sentiment and risk perceptions towards the broader region. With seven military coups in the last three years on the continent, more coups could occur in 2024; especially in: Cameroon, Congo (Brazzaville), Equatorial Guinea and Uganda.
In 2024, the coup threat will be greatest in countries already under military leadership, none of which are likely to organize elections in 2024. Juntas appear increasingly unstable in Burkina Faso, Niger and Guinea.
In Mali, Niger and Burkina Faso, the security vacuum in the border area between these three countries will increase as the military junta appears unable to fill the void left by the departure of international troops in 2022. With the junta distracted by internal challenges, armed groups will continue to expand into new areas, creating new sources of conflict.
In Sudan, the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF) will continue to fight for territorial control, particularly of Khartoum. The RSF has gained the upper hand in the conflict in recent months, driving the SAF out of most of Darfur and key sites in Khartoum. This has increased the likelihood of a Libya-style division of the country.
A war could occur between Ethiopia and Eritrea. Relations between Ethiopia and Eritrea have deteriorated markedly in recent months, sparked by Prime Minister Abiy Ahmed's statements about Ethiopia's willingness to “fight” for access to the Red Sea port.
Despite a slightly improved 2024 growth forecast of 4%, up from 3.3%, according to the IMF, the region will continue to struggle with limited financing. China's economic slowdown and shifting priorities will limit infrastructure lending in Africa, with commitments from 2022 to 20 years.
The threat of default remains high. Kenya faces a June payment deadline, likely manageable with multilateral support. Ongoing restructurings are expected in Zambia and Ghana in 2024, while other countries at high risk of debt distress (19 according to the IMF in 2023) will increasingly rely on international donors.
African leaders will increasingly find political convergence with middle powers such as Brazil, India, Turkey or the Gulf States. This alignment of interests could provide a supportive platform for investment and trade in Africa.
After this analysis in Africa, we will now jump across the pond to Europe.
The European Union, with two wars in its neighborhood, will decide its future at the polls. In addition to the elections to the European Parliament, which will be held between June 6 and 9, 2024, 12 member states also have elections. The general elections in Belgium, Portugal or Austria will be a good thermometer to measure the strength of new ultra-conservative parties, which aspire to emerge stronger in the elections to the European Parliament.
The latest projections in voting intention show important results for the Identity and Democracy (ID) group, home to far-right parties such as Marine Le Pen's National Rally (RN) or Alternative for Germany (AfD). The ID party could reach up to 87 seats and would surpass the other radical right family, the European Conservatives and Reformists (ECR). The ECR chaired by the Italian Prime Minister, Giorgia Meloni, which would go from the current 66 MEPs to 83.
Despite the loss of seats that the traditional forces would suffer, the European People's Party (EPP) would continue as the main political family of the Union , but it could depend on one of these two states.
In 2024, four EU candidate countries will hold elections: Bosnia and Herzegovina, Moldova, North Macedonia and Georgia, and possibly Ukraine. According to its Constitution, Ukraine should hold elections in March 2024. But, under martial law, imposed after Russia's invasion in 2022, with a part of the electorate reluctant to go to the polls in full exceptionality, and with eight million refugees Ukrainians outside the country, Volodymyr Zelensky already pointed out in November that it was not "the right time."
The United Kingdom could call early general elections , scheduled for January 2025. With a challenging scenario for the Conservatives against the Labor Party led by Keir Starmer, the current Prime Minister, Rishi Sunak, has discretion to choose the date of the elections.
Last and least important, we must highlight Ibero-America.
After a decade of relative economic stagnation and diplomatic neglect, there is a renewed sense in Washington, Brussels and other states of the strategic importance of the region.
As we approach 2024, Latin America faces a wide range of economic, energy and political risks.
In Argentina, a hyperinflation scenario could be experienced . Given the expected devaluation, monthly inflation could range between 10% and 13% in the first quarter of 2024. However, Argentina's inflationary trend is clearly unsustainable and we cannot rule out a hyperinflation process (price increases greater than 50% monthly). In turn, another factor that will determine this scenario is the implementation of the dollarization program.
The dollarization of the economy has been the main campaign promise of the Argentine president, Javier Milei. Javier Milei's recent announcements, along with Emilio Ocampo's refusal to become central bank president (Ocampo is a former investment banker and dollarization expert), indicate that the dollarization program will be postponed until at least the end of 2024. .
A key country in 2024 will be Mexico. Tensions between the United States and China, the continuation of the conflict between Russia and Ukraine and the escalation of the Hamas-Israel conflict have led to the acceleration of the diversification of supply chains, where Mexico is playing a more prominent role in global trade. At the same time, Mexico faces economic uncertainty and key elections.
It has been almost six years since the victory at the polls of Andrés Manuel López Obrador brought the left to the highest position of power in the country for the first time. In an environment of fatigue towards corruption and impunity, the politician became the most voted president in history. In the elections of June 4, 2024, his party, Morena, will attend an appointment with all the overtones of the referendum: continuity or change for Mexico.
Likewise, the 2024 elections could be the most conflictive that the country has experienced in many years. The polarized atmosphere, tension and constant confrontations have caused a tense electoral environment.
In June 2024, not only will the new president of the Republic be elected (for the first time in history, in fact, it could be a woman). The two Chambers of Congress will also be renewed, as well as the Executive of nine States, including the capital, Mexico City. The result of the elections could mark the greater economic importance of this power.
At the end of 2024, presidential elections will be held in the United States. These elections are the closely watched and have the greatest impact in the presidential race in the United States, in which current President Joe Biden will seek a second term against a (very likely) challenge from former US President Donald Trump.
It will be a decisive moment for the future of American democracy, eroded by partisan polarization, misinformation, among other aspects. Depending on the result, US domestic and foreign policy could be maintained or take a 180º turn, with important repercussions on the world.
The last country is Venezuela. In recent years, Venezuela's economy has seen a gradual recovery after a deep crisis it suffered during the previous decade and which has driven almost eight million people to leave the country . This growth is due to: the recovery of oil production, which has increased by thirty percent compared to 2022, oil prices have increased, reaching levels higher than before the pandemic due to war conflicts and Reduction of economic sanctions imposed by the United States has given way to new markets and financing.
Venezuela is preparing for the 2024 presidential elections. President Nicolás Maduro has expressed his intention to run for a third term, which has generated strong opposition. The opposition, after several internal discrepancies, will try with the help of candidate María Corina Machado.
It is important to clarify that, in October 2023, several agreements were signed in Barbados between the Government and the opposition. Within these, it is specified that in view of next year's elections authorization will be promoted "for all candidates and political parties", but the Government has already moved away from the possibility of lifting the disqualification on Machado.
Nicolás Maduro needs to keep the new stage of understanding open with Washington for the extension of the relief of sanctions on gas and oil, but he has no intention of ceding power.
In a poll on the intention of the presidential vote, the consulting firm Meganalisis gives the opposition leader a 40-point advantage over the Chavista leader, who has 76% rejection by Venezuelans. María Corina Machado leads with 50.1% in the presidential elections while Nicolás Maduro could obtain only 12.10%
At the same time, in Venezuela, the internal panorama has become even more rarefied with the intensification of the territorial conflict with Guyana and the mobilization of the army.
By 2024, articles on economic, energy and technological matters will continue to be published to continue analyzing and understanding international current events. Thank you very much for all your support. Don't hesitate to give it a like and share the content. From Clave Mundial, I wish you a Happy 2024!
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