American politics is the biggest threat facing the world in 2020 and
the looming presidential election will stress the country's
institutions, influence economic and foreign policy and further divide
an already polarized electorate, with potentially huge consequences for
the climate, business and investors.
That's the view of experts at consultancies Eurasia Group and Control Risks.
The World Economic Forum, which is preparing to hold its annual meeting of political leaders and CEOs next week in Davos, is also warning of increased turbulence this year from trade conflicts and political polarization that makes it harder to tackle global challenges.
Control Risks says that President Donald Trump's campaign for a second term will drive decision-making in foreign policy, increasing the chance that investors will be caught off guard by populist moves favoring US factory workers or farmers.
"The campaign will focus foreign policy on managing crises, distracting US attention from non-urgent issues and geographies. Trump's thirst for deliverable 'wins' before the election, meanwhile, will amplify foreign leverage in trade and security relations," Control Risks wrote in a recent report.
Eurasia Group, which has designated US politics as the top risk for the first time in its annual assessment of the state of the world, warns that the election will be the most divisive in over a century, with the outcome likely to be viewed as illegitimate by roughly half the population.
The analysts expect the result to be contested, no matter which candidate triumphs.
"The 2020 election is an American Brexit — a maximally polarized vote where the risk is less the outcome than the political uncertainty of what the people voted for," Eurasia Group says in its report.
"It's uncharted political territory, and this time in a country where uncertainty creates shock waves abroad."
In preparing its report ahead of the Davos meeting, the World Economic Forum surveyed 750 global experts and decision makers who named economic confrontations and national political polarization as the top risks in 2020.
Taken together, the reports depict a world facing thorny problems with few obvious solutions. Increasingly fractious politics in developed countries is undermining the rules that have underpinned trade and globalization for decades, giving elected leaders license to act unilaterally and stoking conflicts such as the trade war between the United States and China.
Read more: Davos 2020: American politics is the biggest risk facing the world right now, say experts
That's the view of experts at consultancies Eurasia Group and Control Risks.
The World Economic Forum, which is preparing to hold its annual meeting of political leaders and CEOs next week in Davos, is also warning of increased turbulence this year from trade conflicts and political polarization that makes it harder to tackle global challenges.
Control Risks says that President Donald Trump's campaign for a second term will drive decision-making in foreign policy, increasing the chance that investors will be caught off guard by populist moves favoring US factory workers or farmers.
"The campaign will focus foreign policy on managing crises, distracting US attention from non-urgent issues and geographies. Trump's thirst for deliverable 'wins' before the election, meanwhile, will amplify foreign leverage in trade and security relations," Control Risks wrote in a recent report.
Eurasia Group, which has designated US politics as the top risk for the first time in its annual assessment of the state of the world, warns that the election will be the most divisive in over a century, with the outcome likely to be viewed as illegitimate by roughly half the population.
The analysts expect the result to be contested, no matter which candidate triumphs.
"The 2020 election is an American Brexit — a maximally polarized vote where the risk is less the outcome than the political uncertainty of what the people voted for," Eurasia Group says in its report.
"It's uncharted political territory, and this time in a country where uncertainty creates shock waves abroad."
In preparing its report ahead of the Davos meeting, the World Economic Forum surveyed 750 global experts and decision makers who named economic confrontations and national political polarization as the top risks in 2020.
Taken together, the reports depict a world facing thorny problems with few obvious solutions. Increasingly fractious politics in developed countries is undermining the rules that have underpinned trade and globalization for decades, giving elected leaders license to act unilaterally and stoking conflicts such as the trade war between the United States and China.
Read more: Davos 2020: American politics is the biggest risk facing the world right now, say experts
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