Leadership questions will distract Canada's opposition

Significance Canada's main opposition parties -- the Conservatives and the NDP -- are entering a period of reconstruction and reinvention in the wake of October's election victory by Prime Minister Justin Trudeau's Liberal Party, with implications for the government's political room for manoeuvre. Impacts Federal-provincial gridlock and economic concerns from the oil downturn will hinder Canadian climate policy-making. Should poor economic conditions persist despite the government's stimulus programme, the Conservatives could strengthen as a result. National-level scepticism of free trade in many countries will sap momentum in international negotiations, such as for TTIP.

Significance The authorities went ahead with the arrest of Nika Melia, leader of the opposition United National Movement (UNM), on February 23 even after the prime minister resigned in protest. Georgian Dream's actions have caused concern in Western capitals that approved its election victory when the opposition cried foul. Impacts The crisis is a setback for the government's stated plan to apply for EU membership in 2024. There is growing talk in the United States about individual sanctions targeting Ivanishvili and his associates. Political turmoil will harm hopes of foreign direct investment and the imminent Anaklia port tender.


Subject Political changes in Kazakhstan. Significance President Nursultan Nazarbayev has carried out the largest government reshuffle in two years, promoting Deputy Prime Minister Bakytzhan Sagintayev to head the cabinet and placing the outgoing prime minister, Karim Massimov, in charge of the security ministry. Nazarbayev's aims are twofold: to bring in fresh faces to tackle grave economic challenges, and to ensure his security services are able to clamp down on a rising terrorism problem. Impacts The government's top priorities will be to avert protests driven by economic conditions and deal with militant threats. Massimov's security measures will be complemented by the religious affairs ministry's scrutiny of radical Islam. Nazarbayev will seek to manage the succession to preserve his political legacy and his family's interests.


Subject The likely strategy of the BJP's opponents. Significance The opposition to Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) lacks a coherent strategy at national level ahead of elections due in 2019. However, the large turnout at a public rally in Patna late last month, where Lalu Prasad Yadav brought together representatives of 18 opposition parties, suggests that there is popular support for a challenge to the BJP. Impacts States in which elections are due are more likely to see outbreaks of communal violence. Sonia Gandhi will come under increasing pressure to relinquish leadership of the Congress party. The BJP may support the creation of a separate Gorkhaland, at the risk of alienating support in the rest of West Bengal.


Subject Canada's federal political outlook. Significance Canada’s three main parties have all selected the leaders with which they will contest the 2019 federal election. New Democratic Party (NDP) leader Jagmeet Singh, Conservative leader Andrew Scheer and Prime Minister Justin Trudeau of the Liberal Party now have two years in which to define themselves for the electorate and make a case for their parties to assume or resume control of government. Impacts Fallout from fundraiser links to the Paradise Papers tax avoidance controversy could undercut Trudeau’s Liberals. Trudeau’s strong Quebec ties will help him hold off the NDP, but Ontario losses could leave a Liberal minority government. Ontario’s 2018 provincial election will offer an early indication of the strength of Trudeau’s federal opponents.


Significance Bringing the poll forward could be risky for Prime Minister Lee Hsien Loong's People's Action Party (PAP), as it faces a new opposition party and worsening economic conditions. Impacts Tan Cheng Bock will at the next election attempt to unite the opposition behind his Progress Singapore Party. Deputy Prime Minister Heng Swee Keat will likely succeed as prime minister when Lee eventually leaves the post. Singapore's economy is unlikely to benefit from any large-scale redirecting of investment from Hong Kong, despite the protests there.


Subject The outlook for Mongolia's economy. Significance Prime Minister Chimed Saikhanbileg's government has agreed concession partners to work the Tavan Tolgoi coal mine, and there are signs that an end to the impasse over the Oyu Tolgoi copper and gold mine may be close. However, parliament and the approach of elections complicate the policy-making process. A slowing economy and weak fundamentals also pose considerable risks to the country. Impacts Foreign investors will stay away should Mongolia continue to send mixed signals as to whether they are welcome. Politics is likely to become more divisive in the run-up to elections next year. Growth will continue to slow this year, and at best only hold steady in 2016.


Subject The economic challenges facing the Ukrainian government. Significance Ukraine's new prime minister, Volodymyr Groisman, must manage competing demands, domestic and external. External lenders, principally the IMF, are pressing him to carry out overdue reforms that are likely to bring pain to the average Ukrainian hoping for swift improvements in living standards. As well as the ongoing conflict in the east, structural problems are constraining growth. Impacts A resumption in IMF payments will help the balance of payments and work towards currency stability. Slow and patchy recovery is unlikely to translate into higher wages and incomes. The Groisman government is unlikely to win public approval if conditions improve. Its survival will be at risk if there is no discernable change for the better.


Significance The visit, sandwiched between the July 11-12 NATO Summit and July 16 meeting of Trump and Russian President Vladimir Putin in Helsinki, returns UK Prime Minister Theresa May's trip to Washington in January 2017. Impacts The post-Brexit UK-EU deal could scupper a UK-US free trade deal. Trump’s visit may see some new UK-US business deals, and new security and military cooperation pledges. New UK Foreign Secretary Jeremy Hunt will need to build ties with Trump and his administration.


Subject Left-wing extremism and governing instability in Nepal. Significance President Bidhya Devi Bhandari late last month signed protocols operationalising a Transit and Transport Agreement (TTA) reached with China in 2016, reflecting the governing Nepal Communist Party (NCP)’s continued efforts to break Nepal’s historical dependence on its other major neighbour, India. Separately, there have recently been outbreaks of political violence prompted by the Communist Party of Nepal (Maoist) or CPN (M), which opposes the ‘globalist’ direction in which the country is heading. Impacts The NCP government will come under growing pressure to arrest the CPN (M)’s leadership. Indian Prime Minister Narendra Modi, if re-elected, will likely prioritise a diplomatic visit to Nepal. Nepal and China will expedite talks over a free trade agreement.


Significance The governing Liberal Party presented the election as the most important in decades as it sought a mandate to lead the country’s emergence from the pandemic. Instead, the election delivered little change, leaving Prime Minister Justin Trudeau heading a minority government, most likely with support from the left-leaning New Democratic Party (NDP) as before. Impacts An expected cabinet shuffle will see new ministers at key departments including Justice and Foreign Affairs. Provinces will drop their resistance to the proposed childcare programme, which will be in effect before the end of 2022. No new pipelines will be proposed or built while Trudeau remains in office, given perceived government hostility to fossil fuels. The transfer to the provinces of significant responsibility for healthcare will go ahead as decentralisation accelerates.


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