Nationalist politics is on the rise. Many are forecasting rising tariffs and falling global trade as globalization is unpicked by protectionist sentiment. However, the world might be entering a phase of regionalized (opposed to globalized) trade and it may be more of a continuation trend than a dramatic break.
There have been a number of shocks to the political system in 2016 that have jolted analysts’ thinking and brought about a reassessment in business planning for next year.
The first surprise was the decision of the UK to leave the European Union in June. Given the forecasts of economic harm following such a move, London will be preoccupied by managing panicked markets and reforging new relationship with its continental trading partners.
The second shock was the election of Trump as president of the United States. Few anticipated that the American public would elect such an inexperienced candidate. Yet, his bellicose defence of national interest, launched not from an analytical basis but from an emotional platform, served to both repulse the elite and attract voters.