Ones to Watch, 6 August 2018

Americas: Centre-right Duque to take office in Colombia; ELN peace talks at risk

Sectors: all
Key Risks: policy continuity; terrorism; targeted attacks; kidnapping 

In Colombia, centre-right president-elect Ivan Duque will take office on 7 August. Although the new administration is expected to guarantee stability and broad policy continuity, Duque will be tested on economic performance, the FARC and ELN peace processes and the domestic impact of the ever-deepening crisis in neighbouring Venezuela. Duque’s economic policies will remain orthodox and no major changes are expected. On the security front, however, the kidnapping on 3 August of two civilians and four security-force personnel by alleged ELN rebels just days after the government and the ELN announced they had failed to reach a ceasefire agreement as the sixth round of formal peace talks came to an end, indicates that the peace talks might be at risk as Duque vowed to impose stricter conditions for the negotiations to continue that the ELN might refuse to accept.

Asia-Pacific: Student protests escalate in Bangladeshi capital, risk of further violence

Sectors: all
Key Risks: political violence, traffic disruption

In Bangladesh, large-scale student protests over road safety issues have brought the capital Dhaka to a standstill, with thousands of students blocking roads and checking driving licenses. Authorities have violently cracked down on the protests and youth groups linked to the ruling Awami League have reportedly attacked protesters. On 4 August four students were killed and 115 injured in attacks by alleged members of the Awami Youth League. On 5 August police fired teargas on students occupying an intersection and several people were arrested, including a prominent photojournalist and rights activist. On 6 August at least three people were arrested near a university in the Aftabnagar area after police fired teargas and blank shots to disperse students. There is a high risk of further violence over the coming days, while disruptive protests are unlikely to subside.

Eurasia: Usmanov first oligarch to repatriate assets amid sanctions and Kremlin pleas

Sectors:  all
Key Risks: sanctions

A bipartisan group of US Senators introduced a strident new bill sanctioning Russia on 2 August. It includes bans on Russia selling new sovereign debt, would extend caps on Russian uranium imports, mandate a report of President Vladimir Putin’s wealth, and sanction specific transactions related to investing in energy projects supported by the Russian state or parastatal entities. It would also ban some US entities from investing in Russian oil projects. It would be the most strident series of sanctions on Russia to date. The exact text of the bill – dubbed Defending American Security from Kremlin Aggression Act of 2018 (DASKA) has not yet been published, however. Given that the CAATSA sanctions bill passed the Senate 98-2 and 419-3 in the House last August, and shared many of the same co-sponsors, there is a significant risk it will be passed though it may be watered down.

Europe: Macedonian name referendum set for September, further Italian jitters

Sectors: all
Key Risks: political violence; political instability; EU budget limits

Macedonian MPs voted on 31 July to set the referendum on whether the country should be renamed ‘North Macedonia’ as it agreed in a deal with neighbouring Greece on 30 September, although the main opposition VMRO-DPMNE boycotted the vote. The party could also seek to boycott the referendum, which must pass with more than half of citizens taking part. Tensions are likely to rise domestically ahead of the vote and may in Greece as well. Meanwhile, Italy is likely to experience further market jitters over the Five Star Movement (M5S) and League’s spending plans dispute attempts by Prime Minister Giuseppe Conte to calm markets on 3 August, which also saw the Central Bank intervene in Italian bond markets for the third time in as many months.

MENA: Saudi Arabia suspends diplomatic ties with Canada over detained activists row

Sectors: Oil and gas; defense, agriculture
Key Risks: oil prices; contract cancellation

Saudi Arabia suspended diplomatic ties with Canada, freezing all new trade and investment business and expelling the Canadian ambassador. The move is in response to the Canadian foreign ministry’s calls for the release of the Saudi human rights activists. Riyadh accused Ottawa of interfering in internal affairs, in a stance at odds with the government’s progressive image under Mohammed Bin Salman, yet part of a growing trend of hostilities towards those it sees as meddling in its internal affairs. Bilateral Saudi-Canadian trade deals surpassed $4bn in 2017. Tanks, armored vehicles and parts and motor vehicles accounted for ~45 per cent of Canada’s 2016 exports to Saudi, while crude oil and copper ores comprised ~98 per cent of imports. Saudi has stated it reserves the right to take further action.

Sub-Saharan Africa: Zimbabwe’s crucial vote marred by violence

Sectors: all
Key Risks: political instability; political violence

Six people were killed on 2 and 3 August in clashes between supporters of the opposition Movement for Democratic Change (MDC) and security forces in Harare amid accusations of vote rigging in Zimbabwe’s first post-Mugabe elections on 30 July. According to the official results, incumbent Emmerson Mnangagwa won the presidential vote with a razor-thin majority of 50.8 per cent, avoiding a runoff against his challenger Nelson Chamisa of the MDC, who garnered 44.3 per cent, while the ruling ZANU-PF party secured a two-thirds majority of seats in parliament, enough to change the constitution at will. As Chamisa pledged to challenge the result in court, a crackdown against his party continued, with police raiding the MDC’s headquarters to confiscate computers and documents. While international observer missions are yet to pass their final verdict on the vote, it is clear that the democratic dawn Zimbabweans had hoped for has not materialised.