Coming Soon in Our May 2022 Political Risk Reports

PRS’ coverage of the Americas this month includes reports on Dominican Republic, Guatemala, Trinidad and Tobago, and Bolivia, where President Luis Arce has faced significant public pushback against policies that his opponents complain are indicative of authoritarian inclinations. The president nevertheless remains the most popular political figure in the country, and with prices for gas and other key exports soaring in the wake of the Russian invasion of Ukraine in late February, the economic currents will mostly flow in the government’s favor.
The report will examine the government’s prospects for progress on its policy agenda, including the potential for advances in long-stalled efforts to exploit the country’s significant lithium reserves. The analysis will also address the potential pitfalls stemming from the governing administration’s statist inclinations and indigenous opposition to projects involving resource extraction.
Coverage of Eastern Europe will include a report on Ukraine, where the risks for investors have been greatly increased in the wake of the country’s invasion by the Russian military in late February. With near-term conditions certain to be dismal, regardless of the specific battlefront developments, our analysis will focus on an examination of the possible alternative outcomes of the war, and what each would mean for political risk over the medium term.
Turning to the Middle East and North Africa, our coverage in May will include reports on Oman and Saudi Arabia, which is being courted by western governments hoping that the kingdom will help to stem the rise in energy prices by expanding the global oil supply. Although the war in Europe holds the promise of economic benefits for Saudi Arabia in the form of a significant increase in hydrocarbons income, the disruption to agricultural production in Ukraine points to shortages of grain and cooking oils that lead to soaring food prices and an increased risk of a worrisome bout of domestic turmoil. The report will assess the government’s strategy for managing the risks and opportunities arising from the military conflict in Ukraine, and what that might portend for the progress of the crown prince’s broader program of structural reforms aimed at diversifying the oil-dependent economy.
Our extensive coverage of Western Europe this month includes fully updated reports on Ireland, Norway and Portugal, as well as Spain where we assess the political temperature ahead of the next general election due in 2023. Our report looks into the fallout from the Castilian-Leonese regional election that was held in February, which led to the main opposition centre-right People’s Party forming a local government of convenience with the far-right party Vox for the first time. As we look ahead to another important pointer, with the Andalusia regional election coming up this June, we assess prospects for the PP’s new leader Alberto Núñez Feijóo and the direction he is likely to take the party in. We also analyze voting intentions and the political climate more generally in the wake of the pandemic, still-high unemployment, and now soaring prices increasing the cost of living, and how the center-left Spanish Socialist Workers’ Party government led by Prime Minister Pedro Sánchez is planning to respond. Our report goes on to assess Spain’s vulnerability, or otherwise to the crisis in Ukraine, the health of the banks and the tourism industry, and the fiscal picture characterized by an enormous debt load, by presenting forecast scenarios for 2022-2023 for the main macroeconomic variables. Another feature of the report is Spain’s energy diplomacy and recent moves to secure more gas supplies from Algeria.
Our coverage of sub-Saharan Africa this month includes a fully refreshed update on hydrocarbons-rich Congo Republic (Brazzaville) in advance of important legislative and local elections providing another test of popularity for Denis Sassou Nguesso, the controversial septuagenarian autocrat who was re-elected as president in 2021 for another five-year term in dubious circumstances and has now racked up a quarter of a century in power. Our report looks into the prospects for stability and a favorable business environment amid plans to take advantage of high prices for hydrocarbons, as western partners seeking to diversify energy sources away from Russia and the window of opportunity afforded by climate change adaptation have led to a new liquefied natural gas project contract agreement with the Italian petroleum company Eni. We look into whether high inflation exacerbating hunger and poverty in the region will heighten the risks and how the president is strengthening his security services and military ahead of the voting. We also assess the country’s economic prospects and reforms, including anti-corruption measures forming part of a programme with the IMF to ensure debt sustainability.
In Asia, this month, we look into the political risks affecting Mongolia, Papua New Guinea and Singapore. Ultra-safe Singapore may have looked less than rock-solid during the pandemic, but we take a deep dive into its political and economic strengths relative to other nations to ascertain whether its status as one of the world’s safest portfolio options is justified. Our report weighs up the succession question and the direction to be taken by finance minister Lawrence Wong after being confirmed by the People’s Action Party’s fourth generation of young leaders, and subsequently endorsed by the cabinet, as the eventual successor to Lee Hsien Loong to become the city-state’s next leader. Our report looks into Wong’s motivations and ideas, and how he will balance relations between the US, China, and other partners in Europe and Asia, while coping with the pandemic and other, more fundamental challenges that include sustaining growth, keeping inflation down, and ensuring social stability. Our report goes on to assess prospects for monetary policy tightening to combat inflation pressure, the state of the employment market and how it will play into the immigration debate, and the latest on pandemic restrictions and their economic impact.
Since 1979, The PRS Group Inc., has been a global leader in quant-based political and country risk ratings and forecasts. This commentary represents a sneak peek from our upcoming political risk reports. For more information please contact us at (315) 431-0511 and sales@prsgroup.com, or explore a subscription to ICRG Online and/or World Service Online today to receive political risk updates.