Wednesday, 21 December 2011


Another eventful year winds its way to a close in what, by any definition, will not be looked on as a good year for despots. There seems to be a feeling at the moment that the cards are in the air and not too many ideas about quite how they will land. North Africa remains in a state of flux, while Assad’s grip on Syria remains extremely shaky. But will the Arab Spring blossom into a cultural awakening or be submerged under a wave of religious conservatism?

Even after the recent departure of Signor Bunga Bunga in Italy, Europe continues to provide moments of high farce. The announcement of a unanimous accord – well, with the exception of perfidious Albion – has degenerated into the realisation that the tortuous road of 26 European political systems lays ahead. Minority governments in the Netherlands and Sweden, not to mention an entirely absent government in Belgium, potential tricky referenda and looming elections make a quick solution almost impossible. Meanwhile, French chagrin at a loss of its coveted AAA rated status has seen the establishment wrap itself in le tricolour and denounce “ze feeelthy Anglo Saxons and zere huge deficits” as being much worthier of downgrades than La Belle France. This kind of thing plays very well to a domestic audience – particularly important with an election year looming – but I can’t say that going out of your way to offend your main military ally and second biggest net contributor to EU funds is altogether helpful at this stage. I should imagine the correct response to this should be to give a little gallic shrug while uttering the word “Bof” (which has the nearest English translation of “whatever”). Meanwhile, in Berlin, Angela Merkel is making more conciliatory noises about the future role of the UK within the EU.

The internecine conflict in the US between the Republicans and Democrats is also showing signs of flaring up again, as the US enters a presidential election year. That aside, the outlook for the US economy is relatively bright, with indications that employment is beginning to pick up. If this is accompanied by a continuation of growth in China and other Emerging Markets, the global economy should continue to grow and provide a better backdrop to operate within. Interest rates are likely to remain low and this, too, should be supportive of global markets. However, 2012 is likely to be a year as full of surprises as 2011 and like all surprises some are likely to be nice and some less so. Now, where did I leave that crash helmet?


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