Annual Forecasts

2010 Annual Forecast

4 MINS READJan 10, 2010 | 00:13 GMT
A Russian missile launcher rolls through Moscow's outskirts while rehearsing for a parade.
(ALEXANDER NEMENOV/AFP/Getty Images)

Overview

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Europe

To the west of Eurasia lays Europe, a region predisposed to division. It is surrounded on nearly all sides by islands and peninsulas that make it difficult for Europe to cohere. The northern half of the continent, moreover, sits on a plain whose short, meandering rivers tend to empower countries without forcing them to work with others. The southern half is situated on more mountainous terrain that has historically impeded the creation of strong, unified economies. As a result, Europe is a continent riven by pockets of distinct cultures whose differences are all too often irreconcilable.

Jan 10, 2010 | 18:07 GMT
Europe is a continent riven by pockets of distinct cultures whose differences are all too often irreconcilable.

Europe is a continent riven by pockets of distinct cultures whose differences are all too often irreconcilable.

section Highlights
  • As the European Union deals with the realities of the Lisbon Treaty, new -- and opposing -- coalitions will solidify within the union.
  • The most important alliance by far will be the Franco-German relationship.
  • But because many EU states have problems with a union led by France and Germany, and the Lisbon Treaty leaves the details on many forthcoming institutional changes to be sorted out, the bloc will have plenty of opportunity for further disagreements on how it should be run.  
  • Central European members will finally be convinced that they are facing Russia alone and will try to draw a distracted United States into the region in some way. 
  • The United Kingdom is almost certain to elect a Euroskeptic government by mid-year, which could precipitate a crisis with the European Union in second half of 2010.
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Eurasia

Eurasia is the world’s most expansive region. It connects the East to the West, forming a land bridge that borders Europe, the Asia-Pacific, the Middle East and South Asia. Forming the borders of this massive tract of land are the Northern European Plain, the Carpathian Mountains, the Southern Caucasus Mountains, the Tien Shan Mountains and Siberia. At the heart of Eurasia is Russia, a country that throughout history has tried, to varying degrees of success, to extend its influence to Eurasia’s farthest reaches — a strategy meant to insulate it from outside powers. But this strategy necessarily creates conflict throughout Russia’s borderlands, putting Eurasia a near constant state of instability.

Jan 10, 2010 | 18:08 GMT
Eurasia connects the East to the West, forming a land bridge that borders Europe, the Asia-Pacific, the Middle East and South Asia.

Eurasia connects the East to the West, forming a land bridge that borders Europe, the Asia-Pacific, the Middle East and South Asia.

section Highlights
  • In 2010, Russia will consolidate the gains it made in its borderlands during the previous year to insulate itself against any future increased U.S. interest in the region. 
  • With Russia's consolidation effort unlikely to meet serious resistance, other former Soviet territories will be forced to either sue for acceptable terms or seek foreign sponsorship to maintain their independence.
  • But in the Baltic states, Russia will slide toward confrontation with both Europe and the United States. 
  • Though Russia likely will have some success in its periphery in 2010, the Kremlin will face a tough fight at home.
  • As the war between the Kremlin's factions clans intensifies, it will be up to Russian Prime Minister Vladimir Putin to maintain stability in the government and keep the clans from ripping the government apart. 
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Middle East and North Africa

The Middle East and North Africa is the world's crossroads. It encompasses the Arabian Peninsula, the mountains of Iran, the plains of Turkey, the deserts of the Levant, the lands north of the Sahara and all coasts in between. The story of the region, as is so often the case of places stuck between foreign players, is the story of trade, exchange and conflict. The traditional powers of the region are Turkey and Iran — Saudi Arabia and Egypt are the current Arab powers — and their competition for influence over the region's weaker states makes the Middle East and North Africa an arena of violence and instability.

Jan 10, 2010 | 18:08 GMT
The Middle East and North Africa encompasses the Arabian Peninsula, the mountains of Iran, the plains of Turkey, the deserts of the Levant, the lands north of the Sahara and all coasts in between.

The Middle East and North Africa encompasses the Arabian Peninsula, the mountains of Iran, the plains of Turkey, the deserts of the Levant, the lands north of the Sahara and all coasts in between.

section Highlights
  • If Israel makes good on its threat to launch a military strike on Iran's nuclear facilities, it will need U.S. military assistance to accomplish its goal.
  • But Washington would rather avoid a conflict with Tehran to focus its efforts on the expanding war in Afghanistan and withdrawing from Iraq.
  • Turkey will continue to gain prominence, though Ankara will try to skirt any decisive conflicts until it is more confident of its position.
  • The United States' withdrawal from Iraq will test the ability of the war-torn country's factions to work together through the series of political arrangements that have held to date largely because of Washington's browbeating
  • Iraq will become increasingly factionalized in 2010, whether because of the U.S. departure, Iranian meddling as a consequence of deteriorating Iranian-U.S. relations or some combination of these.
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Asia-Pacific

The Asia-Pacific is home to more people than any other region. Centered on the western rim of the Pacific Ocean, this region includes the easternmost countries of continental Asia as well as the archipelagos that punctuate the coast. Several of these countries, most notably China, experienced rapid economic growth in the second half of the 20th century, giving the region a new sense of global economic relevance that continues today. That relevance, however, depends largely on China, a power in transition whose rise is testing the network of U.S. alliances that have long dominated the region. How effectively Beijing manages its transition will shape the regional balance of power in the decades to come.

Jan 10, 2010 | 18:09 GMT
Centered on the western rim of the Pacific Ocean, the Asia-Pacific region includes the easternmost countries of continental Asia as well as the archipelagos that punctuate the coast.

Centered on the western rim of the Pacific Ocean, the Asia-Pacific region includes the easternmost countries of continental Asia as well as the archipelagos that punctuate the coast.

section Highlights
  • Beijing will enter 2010 in almost the same situation as it entered 2009. 
  • China will have little choice but to continue the debt-driven loan and infrastructure programs that allowed it to evade a crash in 2009 until such time external demand revives sufficiently.
  • Consequently, trade spats with the United States -- a country also nervous about its employment situation -- are sure to increase.
  • Facing increasing resistance to its 2009 push to buy overseas resource assets, Beijing will shift its approach in 2010 to more joint ventures and smaller shares as it seeks to deflect criticism and opposition.
  • In 2010, Southeast Asian countries could find themselves at the center of attention -- something they will seek to carefully navigate and exploit.
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Americas

The Americas stretch from the Arctic Circle in Canada to the southern tip of Chile. This geographically, culturally and politically diverse region is home to the United States, a nation whose geography helped it become the foremost economic and military power in the world — an ascendance aided in part by bringing Mexico and Canada into its sphere of influence. Farther south, the nations of South America are like islands, separated by vast spaces of impenetrable mountains, rivers and jungles. Try though these countries may to integrate more closely, deeper ties such as those that characterize North America will prove elusive.
Jan 10, 2010 | 18:09 GMT
This geographically, culturally and politically diverse region is home to the United States, a nation whose geography helped it become the foremost economic and military power in the world

This geographically, culturally and politically diverse region is home to the United States, a nation whose geography helped it become the foremost economic and military power in the world

section Highlights
  • For Latin America, 2010 will be noted not for any great shifts, but rather for continuity, despite substantial internal evolutions in key countries. 
  • In Brazil and Colombia, the policies its governments have pursued by -- relatively liberal, consensus-based and market-friendly investment and tax laws (and in Colombia's case, a focus on security) -- have proved so successful and popular that whoever wins the countries' elections in 2010 will have very little room to negotiate changes. 
  • Argentina will concentrate on gaining access to global capital markets despite the lingering effects of its 2001 debt default.
  • In Venezuela, meanwhile, the question remains one of political control. 
  • Cartel activity in Mexico will spread increasingly across the borders to the United States and Central and South America. 
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

South Asia

Everything that informs geopolitics can be found in South Asia: challenging demographics, geographic diversity, and contentious, ill-defined borders. The Himalayan Mountains form the northern border of South Asia, whose two main rivers, the Indus and the Ganges, support the region’s great population centers. India is the region’s dominant country, home to the world’s fastest growing economy. But its rivalry with neighboring Pakistan, a fellow nuclear power and growing consumer market, has made South Asia one of the world’s most dangerous nuclear flashpoints. The region is also a testament to how militancy and militarism can undermine the regional integration needed to unleash higher economic growth.

Jan 10, 2010 | 18:17 GMT
Everything that informs geopolitics can be found in South Asia: challenging demographics, geographic diversity, and contentious, ill-defined borders.

Everything that informs geopolitics can be found in South Asia: challenging demographics, geographic diversity, and contentious, ill-defined borders.

section Highlights
  • Washington will implement its new Afghanistan strategy: Increase the U.S. military presence from 70,000 to 100,000 in order to roll back the Taliban's momentum, break up the Taliban factions and train the Afghan army.
  • The Taliban will not allow itself to be engaged directly and will instead focus on hit-and-run attacks and internal consolidation to hold out against both the U.S. effort to crack the movement and any al Qaeda effort to hijack the group for its own purposes.
  • Increased U.S. military activity across the Afghanistan-Pakistan border -- mostly drone strikes, but also special forces operations -- will be a defining characteristic of the conflict in 2010.
  • The United States' increased military presence in Pakistan, in turn, will raise concerns for Islamabad. 
  • If jihadists launch a major attack against India, Islamabad will have to redirect troops from battling militants in Pakistan's west toward the Indian border in the east.
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Sub-Saharan Africa

Sub-Saharan Africa is a study in diversity. Covering an area that spans the entire width of the continent beginning at the Sahara Desert and ending at the southernmost tip of South Africa, the region is home to countless cultures, languages, religions, plants, animals and natural resources. It’s no surprise that it captured the imagination of Europe’s earliest explorers — and that it continues to capture the imagination of current world powers eager to exploit it. And yet despite the region’s diversity, Sub-Saharan African countries have common challenges — transnational terrorism, rapid population growth, endemic poverty and corruption — that prevent them from capitalizing on their economic potential. The coming years will be critical for the region, especially as its political institutions mature in a rapidly globalizing world.

Jan 10, 2010 | 18:18 GMT
Covering an area that spans the entire width of the continent beginning at the Sahara Desert and ending at the southernmost tip of South Africa, Sub-Saharan Africa is home to countless cultures, languages, religions, plants, animals and natural resources.

Covering an area that spans the entire width of the continent beginning at the Sahara Desert and ending at the southernmost tip of South Africa, Sub-Saharan Africa is home to countless cultures, languages, religions, plants, animals and natural resources.

section Highlights
  • After years of political transition and power consolidation in the countries, South Africa and Angola will begin vying to become southern Africa's dominant regional power.
  • Though the competition will get off to a sedate start, before long, it will turn into something like a cold war -- that is, a conflict using proxy dissident factions.
  • Each state will work to shape Zimbabwe to its liking, and as longtime President Robert Mugabe's health (or general disagreeability) declines, South Africa and Angola are already maneuvering their favored successors into position.
  • South Africa will try to revive the ties it cultivated with Angola's various ethnic groups back during the country's civil war to undermine the ruling ethnic Mbundu minority.
  • Angola will return the favor by establishing links with the upper echelons of South Africa's much more powerful -- but also much more fractious -- military.
See more on this Region

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

Forecasts

Global Economy

Jan 10, 2010 | 20:02 GMT
An employee at Panmure Gordon & Co., a London investment banking firm, looks at global trading figures.
section Highlights
  • Though the United States is recovering from the recession, banks are still skittish about lending and consumers about borrowing.
  • Europe, on the other hand, will face two economic crises in 2010: a generational banking crisis, and a series of debt mitigation efforts that could well damage the health of the euro itself. 
  • With the U.S. recovery less than entrenched and the European recovery questionable at best, China will need to find an alternative to investment spending to avoid in 2010 the downturn it evaded in 2009. 
  • The key global economic issue of 2010 will be export demand. 
  • But an overproduction of goods will ensure that overall inflation remains extremely tame.

As the year turns, the recession that dominated headlines in 2009 has ended. The recovery in place is unsteady, but appears to have put down sufficient roots to hold. Now in 2010, two major evolutions will take its place: Russia's resurgence and the crisis coming into clearer focus in the Middle East....

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