Tag Archives: russia

A Political Year For 2024

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2024 may be the biggest election year ever, with almost half of the globe voting! At least 64 countries, plus the European Union will be voting and holding national elections. This is a massive year for global politics, so I thought I would discuss some of the notable elections and ones that interest me (don’t worry, I shan’t talk about all 64!).

US

This one probably makes us groan, and I’m sure we’re all bored of hearing about Trump & Biden, but this is arguably the most important election out of the lot. The US is the largest global power, and this election could see a change in USA’s relationship with North Korea, China, Russia and their stance on the ongoing conflicts in Gaza and Ukraine, depending on who wins. Also this is probably the only one where one of the candidates was a previous president who got impeached twice?

Taiwan

I feel like the whole world has been holding their breath when it comes to Taiwan & China, and this election will be no different! The winner of the Taiwanese election will have a tricky balancing act with China, and it’ll be interesting to see if Beijing continues its hold on the island, and whether the imminent threat of invasion will remain.

North Korea

This is interesting, because I didn’t even know the Democratic People’s Republic of Korea had elections (?!). I’m sure the Kim family, who are seen as somewhat deities in North Korea, don’t have an opposition party? What’s even more interesting, is that every election has been given a ‘freedom & fairness’ score (with 0.00 not being free nor fair at all, with 1 being the most free and fair), and North Korea scored higher than a lot of countries! I thought it would score 0.00, but it scored 0.14, which was higher than Venezuela- which I also expected to be low! Countries that scored 0.00 were Syria, Mali, Chad and South Sudan.

India

This election will be one to watch; not only is this election the largest in the world, but India is a rising global power and one of the most populous countries on the globe. The outcome may change not only domestic policies, but also regional politics, particularly concerning China. It may also escalate (or hopefully deescalate) the country’s rising Muslim/Hindu tensions.

Russia

Shockingly another country that’s free & fairness is not at the bottom of the list (although it is above North Korea)! But I don’t think anyone will be shocked when Putin is re-elected and the current trajectory of Russia’s geopolitics continues- i.e. the war continuing.

EU

Sadly, we’ve seen a surge in right wing parties in Europe, and I’m wondering if this will continue into 2024? It seems that a lot of centre-right parties will maintain their current positions, with even far-right parties gaining traction. The main points for discussion will of course be how the EU navigates conflicts, such as in Ukraine and Gaza, along with its green policies and the EU budget. Deficit Rules were suspended during the pandemic, meaning that members were allowed to borrow whatever they wanted to support their citizens, but this is set to be scrapped in 2024, with Deficit Rules being reinstated. Will this create tension between members?

Indonesia

I don’t have a tonne of opinions on this, but I thought it was interesting to note that Indonesia’s elections are only being held over one day! That’s the largest single-day vote, and I wonder how they are going to pull that off in such a large country that has some very remote locations.

Ukraine

Even though Ukraine is under Martial Law, which normally prohibits elections, there has been talk of these elections continuing, as a mark of democratic health. However, this may prove to be too challenging to organise during a war, with safety being a main concern. Either way, Zelenskiy is set to run for a third term, and he will probably win, with his ratings still remaining very high. However, parliament would have to change the law so that Ukrainiens can vote from overseas.

UK

The outlook of British politics has been bleak for a while now, and with the Conservative Party being in power for the past 14 years, some believe that Labour will win the next election, which Sunak has said will be held this year. This is conflicting for me- whilst I am desperate to see the Conservative Party go, and end their reign of austerity, I’m not convinced that the Labour Party will do a better job. Not only that, I have found myself shocked at every vote and election result in the UK for the longest time. None of us thought Brexit would happen, and how naïve we were to think that we would remain. So I’ve learnt to never think that the obvious flaws of the current party, means that they won’t be re-elected!

Whilst this may be the biggest election year ever, it may also be the most challenging for democracy, with many elections being carried out unfairly, or with risk of danger. Not only that, shock decisions and outcomes may shake the geopolitical framework as we know it. It’s going to be an interesting year for sure.

For the full information on the freedom & fairness score, check out Our World In Data: https://ourworldindata.org/grapher/free-and-fair-elections-index and for the full list of elections, along with dates & scores, check out this great article by Time: https://time.com/6550920/world-elections-2024/.

The Financial Impact of Russia’s Invasion of Ukraine

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On the 24th February 2022, President Vladimir Putin announced a military operation in eastern Ukraine. Minutes later, missiles began to hit across the country, including its capital, Kyiv. Whilst I am seldom political on this page, I wanted to write on this topic, as there are massive global implications to this war. Already we have seen many world powers speak out against Russia, with sanctions being put in place, causing the Russian Ruble to plummet by 30% against the US Dollar.

  What implications will the war and the sanctions have on our global economy? Let’s take a look at a few.

Geopolitical Shock

As the whole world reacts to the conflict, and with more and more countries supporting Ukraine (the EU in particular), we have seen bans on flight paths to Russia, SWIFT being sanctioned and Russians being unable to access their bank accounts. We have yet to see fully how China will react but it has signalled a willingness to help Russia. If Beijing responds in a malign way, i.e., using this as an opportunity to go into Taiwan, geopolitical tensions are sure to grow further.

  When Russia invaded Ukraine, we saw the markets sharply drop, but it definitely could have been more extreme, and we actually saw markets bounce back trading to above what it was before the conflict started. Last week, the S&P 500 index logged its first correction in nearly two years, meaning it dropped more than 10% from its recent peak; and even though there was uncertainty about what was going to happen next, the US stock market bounced back quickly. Certainly, NATO and the EU’s response has stopped the market from freefalling.

  Do note, when investments start to tank, investors are tempted to sell and cut their losses. Don’t do this- a major reaction like this is more likely to hurt you more in the long run. The stock market is volatile, it is a part of investing…do not panic.

Energy

  Gas is a large commodity for Russia, and many European countries rely on Russia’s energy supply through vital pipelines. Sanctions on Russia may hinder these countries importing gas. We saw a surge in oil prices last Wednesday; Brent crude futures rose by more than $8, touching a peak of $113.02 a barrel, the highest since June 2014, before easing to $111.53, up by $6.56 or 6.3 per cent by 0950 GMT.

Food Supplies

Not only is crude oil affected, edible oil is too; Ukraine is a huge sunflower oil supplier and if the conflict continues, importers will struggle to replace supplies. Not only that, Ukraine and Russia combined account for 30% of the World’s export of wheat and 19% corn (the two countries also account for 80% of sunflower oil exports!). This means that these food supplies could be hindered, cut off and become incredibly expensive. And this is not the only price that has been driven up. Over the past month, inflation in Europe has jumped to 5.8%, and this conflict could send prices even higher.

Auto

This sector is set to be hit hard by the war; semiconductor sales to Russia are now banned, oil prices have gone up and Ukraine is home to many companies that manufacture car parts. Already we have seen Volkswagen have to close one of its plants in Germany, due to the knock-on effect of Ukraine’s part on its supply chain.

Confidence In The Market

Already we have seen how the war has affected many sectors and sent certain stocks plummeting- and this may want investors and individuals in general to become more cautious with their money. Some may react by saving more and spending less, leading to slower economic growth. People’s confidence will vastly depend on how long the invasion goes on for, and businesses that rely of Russia’s supply chain, such as electronics and automobiles, can be gravely affected.

Will There Be A Further Crash?

  For the last six US-involved wars, the stock market rose in the 10 years following the breakout of war. The Gulf War saw the market rise 500% over a 10-year period. If the entire stock market was to crash in every country it would mean that no businesses anywhere made any profit, and I think we can all agree this would mean that humanity was in a pretty dire situation, with larger problems than just the economy. It’s very difficult to predict what will happen next to the stock market, and we only have public knowledge to base our assumptions off of. If your investing horizon is long, the best thing you can do during times of crisis is to hold tight and keep investing as usual. The stock market has historically always bounced back, and you’ll be rewarded for keeping your reactions in check.

Whatever happens, all we can do is wait and see. Support in anyway you can. Check in with anyone affected by the war, and let us all pray this ends soon.