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DIVERSIFICATION IN THE FACE OF INTERNATIONAL CONFLICTS
At this time and from this perspective, 2017 holds a mixture of dangerous geo-political military maneuvering and the real possibility of an intensification of violence in the Middle East.
On the international economy, notwithstanding predictions by the International Monetary Fund for a rebound of the world economy in 2017 from the 2007-2012 recession, other factors have surfaced to place in question the IMF’s projections of a 3.8 per cent growth rate for the year.
It is acknowledged that Donald Trump as President of the USA is a known-unknown quantity, capable of igniting conflict in conjunction with the dangerously cunning and ruthless Vladimir Putin, and this is after the long-distance ardour of the moment cools.
Ultimately, when President Putin begins to make apparent his reported interest in having Trump elected to the White House, the historically deep ideological suspicion and mistrust of Russia that are spread abroad in American society and reflected in the Congress (both Republican and Democratic) will force Trump to leave the Bear out in the cold.
There are even those who are predicting that there could be a return to the Cold War if relations between the two become completely unhinged.
Then there are the simmering conflicts close to the Russian border and western interests there.
Other flashpoints for conflict between the two are seeded in the crises in Syria, in the existence of Isis, and what to do about it, and in bringing Iran under “manners” for its nuclear ambitions.
On the recent UN Security Council Resolution passed against the illegality of further Jewish settlement in East Jerusalem and the West Bank, which President Obama allowed to pass, President-elect Trump has railed against Obama’s decision and has indicated he will seek to have the resolution revoked: “We cannot continue to let Israel be treated with such total disdain and disrespect,” tweeted Trump.
How will Russia, as a permanent member of the Security Council who voted for the resolution, react if and when Trump seeks to have the resolution reversed?
Moreover, if the Palestinians seek to use the SC Resolution to take Israel before the International Criminal Court, the conflict can sharpen and not only between the US and Russia, but it can also be joined by other members of the Security Council.
Trump has taken the conflict further with his condemnation of the United Nations at the same time that Netanyahu has withdrawn Israeli funding from a number of UN agencies.
So far, this does not amount to a real threat to the international multilateral system assembled in the post World War II environment, but the threat should not be taken lightly.
In the meantime, the US president-elect seems intent on restarting the race to nuclear armament: “Let it be an arms race. We will outmatch them at every pass and outlast them all.
“The United States must greatly strengthen and expand its nuclear capability until such time as the world comes to its senses regarding nukes.”
As I write Thursday, news coming through is the intention of the Obama-led White House to issue sanctions against Russia for reportedly meddling in the US presidential election on the side of Trump.
Upon inauguration, President Trump, still in the heat of the Russian romance, may seek to eliminate whatever sanctions may have been imposed. In this regard, what is essentially a bilateral conflict could spread internationally.
Another flashpoint of geo-political and economic conflict in the year ahead is the possibility of the spreading of the populism that resulted in Brexit–Britain’s vote to leave the European Union and the multi-lateral trading forum.
This was followed by the US Electoral College voting to place in the White House, Donald Trump who has vowed to take the US out of a number of international trading agreements.
Further, the Republican president-elect has threatened to reverse China’s dominance over the US in the trade between the two economic giants of the world.
China’s response has so far been guarded, waiting perhaps to differentiate between Trump’s garrulousness and serious action on the ground, if it were to be taken. In its projection, made six months ago, the IMF relies on the “developing markets of Asia, Africa and Latin America” to pull the world economy out of its prolonged slump.
A slide away from multi-lateral trade agreements, if carried out by Trump, will surely impact negatively on growth in world trade.
The threat even has the potential to drag the world trading community back to the 1920s/30s era when protective barriers grew up, everyone wanting to export, no one wanting to import.
The OPEC month-old agreement to cut back on production and sale of oil has already begun to face challenges, as members of the production cartel seek to carry out their agreed-to decision.
The US under President Obama has not reacted directly. Trump, however, could seek to preserve low oil and gas prices by releasing large quantities of its shale oil and gas supplies and so throw the OPEC plan, to which Russia is part of, into confusion.
This latter possible development, if it materialises, will send the T&T Government and the private sector here into utter confusion not knowing what to do to survive, dependent as they all are on living off high gas and oil prices.
Little is certain among the range of possibilities that now presents itself on the international agenda.
What is real is the need for T&T to face up to the challenge of Independence: diversification of the local economy.
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