Ones to Watch, 5 November 2018

Americas: US midterm elections on 6 November

Sectors: all
Key Risks: split government; protests; political inertia; impeachment

Voters in the United States take part in nationwide elections on 6 November, during which the entire US House of Representatives is up for re-election, as are 35 of 100 Senate seats, although some could see a runoff based on local rules, though these are unlikely to be competitive. The Republicans are expected to maintain control of the Senate and the Democrats to take control of the House, although both very much remain within the margin of error. Should Democrats retake the house, it would enable them to grind-to-a-halt aspects of President Trump’s legislative agenda at least until 2020. However, Trump has threatened to respond by seeking more executive power. A Democratic-led House could also seek to launch impeachment proceedings, although they would not be able to remove the President without two-thirds support in the Senate.

Asia-Pacific: Numbers disappoint in Indonesian protests over HTI flag burning

Sectors: all
Key Risks: civil unrest; sectarian tensions

On 2 November around 7,000 people participated in protests in the Indonesian capital Jakarta and other cities over the burning of a flag belonging to the outlawed Islamist hardline group Hizbut Tahrir Indonesia (HTI). The HTI flag is inscribed with the shahadah – the Islamic declaration of faith – and the burning sparked outrage among Islamist radicals. Similar rallies took place on 26 October. Despite talk of a mass gathering on 2 November to match the 100,000 people who demonstrated in anti-blasphemy protests against former Jakarta governor Basuki ‘Ahok’ Tjahaja Purnama in late 2016, it appears that the HTI controversy failed to agitate the wider Muslim community. This suggests that the Islamic hardline movement has lost a lot of its appeal since the anti-Ahok protests. Controversies related to religious issues are unlikely to significantly harm President Joko Widodo’s re-election bid in April 2019.

Eurasia: Incidents in Azerbaijan and Kyrgyzstan raise spectre of Islamist extremist threat

Sectors: all
Key Risks: unrest; terrorism

The State Security Service of Azerbaijan announced on 5 November that two members of an unspecified ‘radical religious extremist group’ were killed the previous day in a shootout with police in Ganja, the major city in the country’s north. Ganja saw a wave of anti-government unrest earlier this year after police cracked down on alleged dissidents, who it labelled Islamists, after the July shooting of then-mayor Elmar Veliyev. There is little independent reporting on the situation in Ganja and the state’s claims should be treated skeptically. The incident came two days after Kyrgyzstan’s State Committee for National Security (GKNB) announced that five foreign citizens and four Kyrgyz nationals were arrested during a raid in Chui Oblast on 25 October. The GKNB said they were suspected of having recruited for the Islamic State (IS) in Syria and plotted attacks within Kyrgyzstan.

Europe: Hopes of Brexit deal rise despite rising Irish tensions

Sectors: all
Key Risks: political instability; trade disruption; localised unrest  

Hopes for a deal between the European Union and United Kingdom over Brexit have risen over the past week as officials hinted a deal could be agreed in mid-November. However, Ireland’s Taoiseach Leo Varadkar noted that tensions over Brexit had already ‘undermined’ the Good Friday Agreement, the 1998 peace deal that eventually ended fighting in Northern Ireland and led to a devolved government for the territory. There has been no local government in Northern Ireland since January 2017, largely as the Democratic Unionists (DUP), the main Unionist party, have more power in Westminster thanks to British Prime Minister Theresa May’s reliance on its support. Varadkar’s comments risk a negative reaction from the DUP and hardline British Brexiteers. Northern Ireland will remain contentious in Brexit talks and the process will raise the risk of localised unrest.

MENA: New wide-ranging US sanctions come into effect

Sectors: all
Key Risks: sanctions, political stability

Renewed US sanctions imposed by US President Donald Trump came into force, targeting 700 Iranian individuals, entities, vessels and aircraft, banks, shipping and oil exporters in the widest ranging sanctions yet imposed on the country. However, oil slipped in early trading as it is expected that temporary waivers will be granted to countries reliant on Iranian oil. A list of countries granted oil waivers is expected to be confirmed today, with India, China, Japan, South Korea all on the list. Other possible recipients of waivers are Turkey, Iraq, Armenia and possibly the UAE. Waivers are reportedly temporary and are being used by the Trump administration to pressure countries to wind down trade with Tehran. Tehran maintains that there is not enough global spare production capacity to make up for the loss of its crude. Protests occurred outside the former US embassy in Tehran and will likely continue as sanction bite.

Sub-Saharan Africa: UN Security Council to lift Eritrea sanctions

Sectors: all
Key Risks: sanctions; political stability

The United Nations Security Council is set to adopt a resolution circulated by the United Kingdom lifting sanctions on Eritrea after the United States gave up its opposition to such a move. The measures, which include an arms embargo and targeted sanctions against government officials, were imposed in 2009 over human rights abuses and allegations Eritrea’s government backed Somalia-based Islamist group Al-Shabaab. However, UN monitors have never found conclusive evidence of such support. The Council’s turnaround follows the conclusion of an agreement between Eritrea and Ethiopia in July to formally end their 28-year conflict and is meant to encourage regional countries to continue working towards peace. The removal of the sanctions regime could end Eritrea’s international isolation and spur foreign investment. A vote on the resolution is expected for 14 November.