Eurasia Group names top global risks for 2021

05 January 2021 3 min. read

Eurasia Group, a New York-based political risk consulting firm, has released its annual list of the top global risks for 2021 – which include a loss of confidence in electoral legitimacy from Republican voters and the lingering impacts of the Covid-19 crisis. The consulting firm’s annual list outlines the predicted greatest threats to nations, global politics, industries, and institutions.

The report, co-written by president Ian Bremmer and chairman Cliff Kupchan, tagged the idea of the asterisk presidency (46*), as the top risk for 2021. Despite no evidence of electoral fraud, most Republicans have bought into President Trump’s allegations that the presidency was stolen from him. According to a December Reuters/Ipsos poll, 68% of Republicans believe the presidential election was rigged.

Aside from mishandling the Covid-19 crisis at every turn and causing immense excess death and suffering, Trump’s undermining of public trust in the democratic process may be his most reprehensible act.

Manufactured illegitimacy in a post-truth world will make it harder for Biden to do the work of governance. “Facing an aggrieved opposition loyal to the Trump brand, Biden will find it more difficult to govern than under the ‘normal’ conditions of split government,” Bremmer and Kupchan said. Gridlock will prevent the passage of a large stimulus package, changes to the healthcare system, a higher national minimum wage, and filibuster reform.

Biden presidency faces both structural and legitimacy challengesHowever, legislative gridlock is dependent on the Republicans retaining control of the senate. If Democrats win the two Georgia seats in today’s runoff election, they will gain control of the house, senate, and presidency – and will be able to more effectively enact their policy platform.

A lingering Covid-19 pandemic will also continue to undermine political stability and the global economy. Bremmer and Kupchan say that governments will struggle to meet vaccination timelines, as well as face the challenges of heavy debt loads, displaced workers, and eroding trust. Public unrest will be further stoked by the unequal impacts of the pandemic, which has hit low-income and minority communities, women, and service sector workers the hardest.

Meanwhile, the evolution of the virus – such as the South Africa/UK strain – present concerns over the efficacy of vaccines currently being distributed. What does economic recovery look like if the pandemic doesn’t end this year?

The report also predicts that US-China tensions will broaden. Though Trump acted unilaterally on China policy, Biden will enlist and coordinate with allies such as the EU and Japan on lingering issues such as trade, Hong Kong and Taiwan, and the South China Sea. China, meanwhile, will use its vaccine – which can be more easily distributed in emerging countries – to deepen its diplomatic inroads in Southeast Asia, Africa, and Latin America.

Countries with the most cross-border data

The US is also expected to compete more actively with China on green energy under Biden, making major investments to re-shore portions of its clean energy supply chain.

Bremmer and Kupchan also expect a global data reckoning, with a slowdown in the flow of sensitive data across borders. The Trump administration’s attempts to ban TikTok and WeChat were a high-profile instance of this growing trend.

China and the US’ tech cold war will include a push for data sovereignty, with increasing efforts to keep data and critical infrastructure from passing through their adversary’s equipment. The report says this will hamper business models for AI and emerging tech and force companies to build new data centers. It is also expected to hinder drug research which uses large data sets and shares medical and personal information.

The Eurasia Group report also expects an unprecedented wave of cyber warfare by state and non-state actors in 2021, as well as growing instability in the Middle East and North Africa due continued low oil prices.