Americas: Opposition candidate Mohamed Irfaan Ali sworn in as president

Sectors: oil and gas; mining
Key Risks: political instability; policy continuity; civil unrest

In Guyana, Mohamed Irfaan Ali from the opposition PPP/C was sworn in as president on 2 August, exactly five months after the 2 March general elections. The political standoff over the results of the highly contested vote continues, with the outgoing ruling APNU+AFC alliance denouncing the result’s legitimacy. Ali took office shortly after the Guyana Elections Commission (GECOM) officially declared the election’s results according to the 33-day vote recount process that ended in June. Several legal challenges delayed GECOM’s declaration, which was accepted by outgoing president David Granger. Nevertheless, Granger stated that an election petition could be filed potentially further stoking instability risks, which Ali is likely to face throughout his five-year term. Although the declaration has somewhat mitigated the risk of major unrest, the risk of protests fuelled by Granger’s APNU+AFC alliance cannot be entirely ruled out.


Asia Pacific: Pakanstani separatist groups unite to sabotage Chinese assets

Sectors: BRI projects
Key Risks: business; insecurity; 

Pakistan’s Baloch and Sindi separatist groups formed an alliance aimed ostensibly at targeting Chinese assets, nationals and the development of China Pakistan Economic Corridor (CPEC). The founding declaration expressed resentment toward China’s alleged expansive and oppressive policy to secure resources in the provinces of Sindh and Balochistan. Baloch insurgents were responsible for the attack on the Pakistan Stock Exchange in June. While the new alliance will significantly increase security costs for CPEC initiatives, it is unlikely to halt the flagship project of China’s Belt and Road Initiative. As China’s global footprint extends, its economic activities are to directly impact, sometimes adversely, local communities. The pushback is inevitable. Yet, local resistance presents an opportunity for CPEC to become more inclusive in an effort to gain support from communities by giving them an economic stake in the projects.


Eurasia: Belarus’ most dramatic election yet prompts major risks for government stability

Sectors: all
Key Risks: political stability; civil unrest; economy

On 9 August Belarus is scheduled to hold its presidential election, in which President Alexander Lukashenko, in office since 1994, faces his greatest-ever public opposition. Svyatlana Tsikhanouskaya, the only registered opposition candidate, has organised major rallies in the capital and smaller cities. Her popular blogger husband was jailed when declaring his run for the presidency, as were other would-be opposition candidates. Rallies may grow in the run-up to the vote and there are rampant local rumors it could be delayed. Despite Tsikhanouskya’s unprecedented protest movement, the election is unlikely to be fair and independent observers have been barred. How the government chooses to handle any post-election protests will remain crucial to its long-term stability. Furthermore, Minsk’s recent fallout with Moscow over the arrest of suspected Russian military contractors it claimed colluded with Tsikhanouskaya’s husband further raises the risks to Lukashenko’s regime.


Europe: Q2 GDP contractions worst-ever, political risks remain to EU’s new debt and grant

Sectors: all
Key Risks: economic recovery; EU cohesion 

Figures released over the last week showed Eurozone GDP shrank by a record 12.1 per cent quarter-on-quarter in Q2 2020. Across the EU as a whole GDP shrank 11.9 per cent. Spain reported the largest contraction – 18.5 per cent – and France, Germany and Italy all shrank more than 10 per cent. The EU imposed strict lockdowns following COVID-19, collapsing production and consumption. There are some signs of a potential recovery, although with COVID-19 cases rising, any recovery will be shallow. Brussels’ and EU heads of states agreement in July to raise joint debt and finance grants to poorer and more affected member states should temper market jitters. However, significant risks remain and related political spats, such as France’s 3 August proposals for more sanctions over rule of law concerns in member states, could still cause turbulence.


MENA: Lebanon’s foreign minister resigns; Iraqi elections announced for 2021, 11 months early

Sectors: all
Key Risks: political instability; civil unrest; humanitarian crises

On 3 August Lebanon’s Foreign Minister Nassif Hitti resigned, citing a lack of political will to reform and warning of a “failed state”. Hitti’s departure is the third high level resignation since June. The move is also thought to be over differences with Prime Minister Hassan Diab following his criticism of erstwhile ally French Foreign Minister Jean-Yves Le Drian during a recent visit. Hitti’s replacement is expected to be announced imminently. Sources indicate that Charbel Wehb, advisor and close acquaintance of President Michel Aoun, may be selected. Iraqi Prime Minister Mustafa al-Kadhimi announced elections for June 2021, 11 months early amid dire civil, economic and political crises exacerbated by the oil price crash and COVID-19. Civilians have demonstrated since October 2019 over dire social, political and economic conditions. However, without deep-rooted constitutional overhauls, corruption and cronyism will continue hindering progress.


Sub-Saharan Africa: Cote d’Ivoire’s opposition FPI names former PM N’Guessan as presidential candidate

Sectors: all
Key Risks: political instability; civil unrest

In Cote d’Ivoire, the opposition Ivorian Popular Front (FPI) named former prime minister Pascal Affi N’Guessan as its candidate for the 31 October presidential election. N’Guessan will face former president Henri Konan Bedie and, potentially, former rebel leader Guillaume Soro and incumbent President Alassane Ouattara, who has not said whether he will stand for a controversial third term. N’Guessan’s nomination comes as Ouattara’s predecessor and FPI founder Laurent Gbagbo, recently acquitted by the International Criminal Court from charges of crimes against humanity allegedly committed during the 2010-2011 civil war, is unable to return as Ivorian authorities are yet to issue him a new passport. N’Guessan’s nomination risks alienating the FPI’s pro-Gbagbo camp, which has called on Gbagbo to launch his own bid. An increasingly crowded field of candidates further increases Ouattara’s chances should he decide to run for re-election.