How people can keep their investments less vulnerable to events in 2024
The elections year: 2024 is going to be the year of elections. An estimated number of over 4.1 billion people out of the total global population of over 8 billion are living in countries that will go to polls in 2024. According to Bloomberg, countries that contribute 80% of the world market cap and 60% of global GDP will be voting.
These include India, the US, and Indonesia, where a regime change can have the potential to derail the path to the progress of the respective economies as well as the potential to derail global growth. Globalization: The idea of protectionism has gained momentum after the covid-19 pandemic. Most nations want to “derisk" their supply chains, keep production at home or closer to home, and are willing to re-negotiate trade pacts and trade relations.
Special incentives are being doled out to keep manufacturing local. Production-linked schemes in India and, the CHIPS Act in the US are a few examples. If nations start choosing their trade partners based on convenience and economies of scale, poorer nations will be the biggest losers.
The gap between richer and poorer nations will widen further resulting in coups and civil wars. We are already witnessing the same in some African countries like Sudan. Economic prosperity is the key to peace.
Re-election of leaders who support protectionism will have its long-term consequences. Geopolitical risks: Geo-political risks always pose a threat to the markets and economy alike. China’s quest to conquer the Sea of Japan and Taiwan, the ongoing war between Russia-Ukraine and Hamas-Israel, Saudi Arabia’s policy trade-off between its efforts to become a liberal economy and its support to Islamist States in its neighbourhood, and Indo-China relations in the
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