Risk updates, 18 February 2013: Cameroon, Chile, Cyprus…

  • Source: AKE
  • Published: 18 February 2013
  • Filed: 21 February 2013
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Demonstrators gather in Hong Lim Park, Singapore, to protest the government's population white paper, 16 February 2013 (Photo: Au Waipang)

Demonstrators gather in Hong Lim Park, Singapore, to protest the government’s population white paper, 16 February 2013 (Photo: Au Waipang)

Cameroon

Cameroon’s cocoa exports are likely to drop in quality and quality, due to disease and poor rainfall. New EU regulations on cocoa quality are also likely to damage the industry. As cocoa accounts for half of the country’s primary sector exports, equivalent to US$520m a year, the decline will have a severe impact on the economy.

Chile

The 13 February arrest of 20 Mapuche Indians, following clashes with policemen in the southern town of Collipulli, in the Araucania region, is just the latest in a series of confrontations and the mass arrest will likely trigger further protests and violence.

Cyprus

If, as expected Nicos Anastasiades wins the island’s presidential elections in the second round run-off, he may push through the privatisation of some state assets, a policy which incumbent Christofias had rejected.

Ecuador

President Correa was re-elected for a third term with over 50 per cent of the popular vote and thirty points ahead of his main opponent, removing the need for a second round. Correa’s victory address promised ‘four more years of revolution’ and signalled further socialist reforms, including new regulations for media content and a land reform campaign. The government’s main challenge will be to offer investment security while keeping significant revenue to support socialist programmes.

India

The government is likely to cancel contracts with any firm involved in corrupt practices, as Congress attempts to combat the perception of systemic corruption within state institutions.

Malaysia

Malaysia’s GDP is expected to remain stable in the short to medium term despite a decline in exports and overall FDI. But without significant reform of economic distortions and encouragement of greater private investment, growth is likely to plateau and the country is unlikely to develop into a high income economy. Furthermore, internal political and social tensions may grow unless quota systems, corruption and ethnic favouritism are reduced by the government. Increased civil unrest in the lead-up to (and following) national elections in 2013 is a possibility.

Mali

The military junta will continue to play a major role in Malian politics in the coming months. The risk of a further coup in the next few years is moderate to high, particularly once international have left Bamako following the offensive and scheduled election. Divisions within the military could also generate further unrest in the capital.

Nigeria

A group of up to 30 unidentified gunmen killed a security guard and kidnapped seven foreign nationals from a Setraco road construction camp in Jama’are, Bauchi state on 16 February. The gunmen also attacked a nearby police station and prison. The kidnap victims include British, Italian, Greek and Lebanese nationals. Initial reports suggest that militant group Ansaru may be responsible, as they used a similar strategy in the kidnap of a French national in Katsina state in December 2012.

Pakistan

A bomb attack on 16 February claimed by radical group Lashkar-e-Jhangvi killed at least 84 people and injured 178 in a predominantly Shi’ah area on the outskirts of Quetta. Government failure to provide security has led to Balochistan province being placed under ‘governors rule’. The death toll from sectarian violence is reportedly at 200 this year in comparison to 400 in the whole of 2012. Further violence and subsequent protests by Shi’ah citizens against a lack of security are to be expected.

Russia

A deal between ExxonMobil and Rosneft, allowing the international oil company access to seven new artic blocs in the Chukchi, Laptev and Kara Seas likely indicates that foreign interest in Russian Arctic fields will remain high despite a number of operating challenges.

Russia – Georgia

Even though the Russia’s Investigative Committee charged Georgian parliamentarian Givi Targamadze, an ally of President Saakashvili, he is unlikely to face extradition although a criminal investigation could be launched at Moscow’s request. While the incident highlights continued tensions between Moscow and the Georgian president, bilateral relations are expected to see broader improvement under the premiership of Ivanishvili.

Singapore

In one of the largest rallies in decades, several thousand people gathered to demonstrate against a new government white paper that includes immigration as a feature of plans to offset the country’s slowing birth rate and ageing population. Many Singaporeans are angry because they see immigration as the cause of property price hikes and lower wages. Despite the recent introduction of labour reforms aimed at tightening the influx of foreign labour, the government may look to appease voters with further immigration restrictions.

South Korea – North Korea

South Korea’s announcement that the country will deploy cruise missiles capable of striking North Korean command headquarters, following North Korea’s recent third nuclear test suggest an arms race is escalating in Northeast Asia. New reports indicate that Pyongyang may test a 4th and 5th nuclear weapon in 2013. Pyongyang’s latest nuclear and missile tests, which likely indicates an increasing nuclear weapons capability, has created greater impetus for Seoul and Tokyo to rethink their security policies, including Seoul potentially building a nuclear arsenal of its own and Japan changing elements of its restrictive pacifist constitution. While there is no love between China and North Korea, Beijing is unlikely to take hard measures to encourage Pyongyang to halt its weapons programs in the near future.

Sudan – South Sudan

Tensions along the disputed border will escalate in the coming weeks after both countries accused the other of military escalation around Unity state. Amidst reciprocal accusations of that the other side had assisted proxy rebel groups, talks between Sudan and south Sudan hit an impasse in Addis Ababa over failures to implement of 2012 peace agreements.

Thailand

Recent trends suggest large-scale attacks, similar to the assault by dozens of heavily-armed separatists on a military base in southern Thailand can be expected in coming months. Attacks are likely despite government plans to deploy around 2,500 volunteer paramilitary personnel to aid security in the region.

Venezuela

President Chavez made a surprise return from Cuba more than two months after he had surgery for an undisclosed type of cancer. Chavez’ return to Venezuela followed the first publication of images of the president, as officials declared that he was breathing through a tracheal tube and was struggling to speak. Through twitter, Chavez announced that he would continue his treatment in Caracas but it is still uncertain whether he will be able to fulfil his duties.

Vietnam

Vietnam’s slow-burn economic crisis, which has resulted in growth falling to a 13 year low in 2012, will result in the ruling communist party facing mounting public opposition as people blame the party for poor economic management.

Source: AKE (United Kingdom)

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