The Bloomberg agency gave its readers a real "nightmare before Christmas". It amounted to 2019 global threat rating... Not the most New Year's theme, frankly, but, as they say, whoever is forewarned is armed.
8. Trade Wars
The first challenge for the global economy in 2019 is the US-China trade war, which has slowed both China and the Eurozone's growth and macroeconomic performance. Even the US economy, which has surpassed all expectations this year, is likely to suffer in the future. In an interview with the Wall Street Journal, Maurice Obstfeld, chief economist at the International Monetary Fund (IMF), predicted that U.S. economic growth will slow in 2019 as weakening economic performance in Asia and Europe threatens to negatively impact the U.S. economy.
The Organization for Economic Co-operation and Development (OECD) recently revised its forecast for global economic growth in 2019, denouncing the bitter US-China trade war as "the main culprit." In its latest economic outlook report, the OECD said that the global economy is expected to grow 3.5% in 2019, up from a 3.7% forecast published in September. Although the US and China have temporarily "reconciled" in recent days, most analysts said their trade confrontation would continue into the next year.
7. Brexit
The process of leaving the UK from the EU (Brexit) is currently "stuck" in the British parliament. Many members of the ruling party, as well as Her Majesty's opposition representatives, protested against the Brexit agreement that the UK government recently concluded with the EU.
If the British parliament rejects this agreement, a political crisis may begin in the country. According to Bloomberg estimates, the aforementioned “difficult” scenario could lead to a decrease in the UK GDP by 7% by 2030 compared to when it was still a member of the EU. If such an unexpected scenario does occur, it will have a negative impact on the global economy in the new year.
6. The crisis in Italy
The 2019 ranking of the main dangers includes a contradiction between the Italian government and the EU. Rome costs too much. In its annual review of the budget plans of the Eurozone countries, the European Commission said that Italy's budget is "particularly inconsistent" with the restrictions imposed by the EU.
However, the Italian government has so far defied EU budgetary demands. The conflict has left investors and EU officials feeling insecure and worried that Italy will trigger another financial crisis in Europe next year.
5. Political crisis in the USA
The top 5 global risks in 2019 are opened by the country of the victorious democracy, and, specifically, the Democrats who took control of the US House of Representatives during the recent midterm elections. It is quite possible that they will start "putting a spoke in the wheels" of Donald Trump and his team. There is an option that this confrontation could end with Trump's impeachment.
4. Elections
2019 will be an election time for some emerging economies (notably Indonesia, India and Argentina). And this threatens to negatively affect the world economy due to the growing influence of populist politicians. This has already happened in Brazil, where Jair Bolsonaro, nicknamed Tropical Trump, came to power.
3. Oil
In 2019, Middle East politics will receive increased attention, especially the US relations with Iran and Saudi Arabia, as well as the relations of OPEC and its allies.
Political tensions are growing between members of the Cooperation Council for the Arab States of the Gulf in connection with the boycott of Qatar under the leadership of Saudi Arabia. This could potentially undermine the willingness of OPEC countries to work together to balance the oil market.
If the strategy providing for the reduction of oil production by OPEC members is revised, then about 1.8 million barrels of "black gold" per day will return to the market. This will lead to a collapse in prices (but not for gasoline in Russia).
While this will also lead to slightly higher fuel consumption, prices could still return to their previous lows (around $ 40 a barrel). Cheaper oil will support economic activity in countries that rely heavily on imported energy or energy-intensive industries.
But countries that are heavily dependent on oil exports - primarily the Gulf countries, as well as Russia, West Africa and some Latin American countries - will be severely affected economically. Developing countries, including Nigeria and Angola, will face severe debt problems, and possibly political and social instability.
2. Waterways in East Asia
North Korea and the United States have temporarily stopped figuring out which of them is the coolest on a global scale. This gave America the opportunity to focus on the disputed South China Sea. She conducted exercises in the Philippines region, involving two naval strike teams and about 150 carrier-based aircraft.
Such a show of force by the United States cannot but worry China. It is unlikely that it will come to an open military clash, however, the already strained relations between the stronghold of world democracy and the Celestial Empire will clearly not improve.
And concerns about how China intends to use its ever-expanding capabilities to support territorial and maritime claims could push other countries into political confrontation with it, despite the country's economic weight.
1. Terrorism
The biggest risk to humanity in 2019, according to Bloobmerg experts, is not country-specific. That is why terrorism is terrible because it threatens people in different states. According to Robert Niblett, head of the British think tank Chatham House, a terrorist attack can take any form, including cyber.
A large-scale incident could have dire consequences for the global economy, as the government of the affected country will react unpredictably.
Last year, according to the National Consortium for the Study of Terrorism at the University of Maryland, 26,400 people died in terrorist attacks around the world.