NYPD agents detain a protester at a protest during the 2020 presidential election in New York.
Photographer: Stephanie Keith / Bloomberg
Photographer: Stephanie Keith / Bloomberg
With the global economy still in the teeth of the Covid-19 crisis, the Eurasian Group sees a divided US this year as a major risk to a world without leadership.
“In recent decades, the world has looked to the US to restore predictability in times of crisis. But the world’s leading superpower is facing major challenges, ”Eurasia Group President Ian Bremmer and Chairman Cliff Kupchan said in a report on the key risks for 2021.
Starting with the difficulties facing the Biden administration in a divided US, the report identifies 10 geopolitical, climatic and individual country risks that could derail the global economic recovery. Extensive Covid-19 impact and K-shaped recovery in both developed and emerging economies is the second largest risk factor cited in the report.
Biden will struggle to gain new confidence in the US global leadership as he struggles to manage domestic crises, the report said. With much of the US raising doubts about its legitimacy, the political effectiveness and longevity of its “asterisk presidency,” the future of the Republican Party and the legitimacy of the US political model are all in question, it added.
“A superpower torn in half cannot return to normal. And when the most powerful country is so divided, everyone has a problem, ”said Bremmer and Kupchan.
The report cites the following risks in 2021:
| Main risks 2021 | |||
|---|---|---|---|
| 1. | American Presidency | 6. | Cyber conflict |
| 2. | Covid-19 will run until 2021 | 7. | Turkey |
| 3. | Implications of net zero emissions targets | 8. | Cheap oil |
| 4. | Tensions between the US and China | 9. | Europe after Merkel |
| 5. | Global data control | 10. | Latin America |
The report warns that the pandemic and its widespread impact will not go away once vaccination becomes widespread. Uneven recovery measures, disparities in access to vaccines and inadequate stimulus plans will add to debt, leave workers displaced and stir up opposition to incumbent leaders.
For the US, this will increase the polarization that fueled support for Donald Trump. For emerging economies, the debt crisis could lead to financial problems, the report said.
Some concerns are more likely exaggerated risks from “red herring,” the report adds. These include relationships between Biden and “Trump’s fellow travelers” such as Recep Tayyip Erdogan from Turkey, Jair Bolsonaro from Brazil, Boris Johnson from the UK and Israeli Binyamin Netanyahu. The Biden administration will be concerned with shared interests and leaders will adapt to the new status quo, the report said.
Fears of a global backlash against US big tech and a confrontation between Iran and the US are also seen as lower risks.