Brasidas Group is pleased to present another issue of our newsletter, focusing on Latin America and recent changes that have swept the region, impacting not just the economies of these countries, but society itself. What we have seen in Latin America is the interconnectedness of its different regions, such that political and social shifts in one state bring about changes in the everyday lives of citizens in neighboring countries.
Brasidas Group AG is proud to announce its sponsorship of a young Croatian skier, Ziggy Vrdoljak. Born in Zagreb in 2007, Ziggy is only 12, but demonstrates extraordinary potential as a skier.
Ziggy was born into a sporty family, and he began training skiing when he was merely two years old. By the time he turned seven, Ziggy’s devotion to skiing was unquestionable, and this is when he won his first ski race with a broken hand. Today, he spends approximately one hundred days per year on his skis.
Since being elected in 2016, U.S. President Donald Trump has shown himself to be more capricious than most presidents when it comes to his decision making. Indeed, President Trump gave us that exact display when on 20 June, he called off retaliatory military strikes against Iran at the last minute. In a tweet, he said he made the decision to abort the operation “against three Iranian sites” when he was told 150 people would die. The move comes after Iran shot down a U.S. drone the day before, saying it was brought down over the Strait of Hormuz. The U.S., for its part, maintained that it was flying over international waters. Tensions have steadily been escalating between Washington and Tehran in recent months, spearheaded by Trump’s National Security Adviser John Bolton. On 6 May, the U.S. deployed the USS Abraham Lincoln Carrier Strike Group and a bomber task force to the U.S. Central Command in the Middle East. Bolton, an ardent Iran hawk, said the U.S. wants to "to send a clear and unmistakable message to the Iranian regime that any attack on U.S. interests or on those of our allies will be met with unrelenting force.”
Nearly three years have passed since British voters decided that the UK should leave the European Union and embark on the painful process of Brexit. With that vote, the near-inevitability emerged that British-based businesses would face severe consequences, which would in turn affect potential investors drawn to the country. Specifically, such an adverse situation would likely occur as the outcome of a so-called “hard” Brexit, a scenario in which the UK would leave the EU without reaching an agreement to remain in the European market. The “hard” or “no deal” Brexit appears more likely by the minute, since, after facing pressures from her party colleagues, Prime Minister Theresa May resigned – this after her latest push to get approval for her version of the Brexit deal was rejected by her political allies.
On Easter Sunday, 21 April 2019, Sri Lanka became the site of one of the worst terrorist attacks since 9/11, as several Christian churches and luxury hotels were targets of coordinated bombing attacks. The number of victims comes to 253 individuals, including foreigners. On 23 April 2019, the Islamic State claimed responsibility for these attacks, proving that the local Jihadi group National Thowheeth Jama’ath had help from a much more powerful international Jihadi ally. The initial probe claimed that these bombings were retaliation for the attacks on mosques in New Zealand in March 2019, committed by a far right extremist and resulting in the deaths of over 50 Muslims. However, these claims were not backed by evidence or concrete intelligence. Soon after, the leader of the Islamic State, Abu Bakr al-Baghdadi, appeared in a video for the first time in five years, claiming that the Sri Lanka attacks were retaliation for the fall of Baghouz, the Islamic State’s stronghold in eastern Syria, which was taken by US-backed Kurdish forces in March 2019.
On 25 February 2019, Iranian Foreign Minister Javad Zarif announced that he would be resigning from his post as the country’s chief diplomat. One Iranian specialist described this process as “foreign betrayal, domestic infighting.” In that context, Zarif’s resignation was a response to the fact that he was not present during the visit to Iran by Syrian President Bashar al-Assad, symbolizing the neglect of the Iranian Foreign Ministry in foreign policy making. The resignation was also a response to the U.S. withdrawal from the Iranian nuclear deal, which was Zarif’s groundbreaking achievement. However, Zarif quickly rescinded his resignation, as none of the political stakeholders in Iran accepted it. This episode is a manifestation of a process in which Zarif is seen as a figure needed to remain in power in order to maintain a balance between three factions in Iran: the moderates, the reformists, and the hardliners.
In February 2019, U.S. President Donald Trump and North Korean Chairman Kim Jong-un met in Hanoi, Vietnam for a summit addressing the issue of North Korean nuclear capability. The summit ended abruptly without an agreement, as Trump demanded a guarantee against nuclear and missile tests, while Kim demanded a lifting of all sanctions. Some experts greeted this news with assertions that the Hanoi summit was doomed from the start as North Korea never intended to denuclearize, calling that moment “the Hanoi Holdup.” However, it might be more appropriate to say that the Hanoi Summit was never intended to achieve an outcome in which Pyongyang gives up on its nuclear arsenal. Instead, the Hanoi Summit should be viewed as part of a long forthcoming diplomatic process of confidence-building measures and de-escalation.
Slovenia is beyond a doubt the most successful of the former Yugoslav republics. It was the first to join the European Union in 2004, and its GDP per capita is estimated at USD 36,163 according to the Organization for Economic Development and Cooperation (OECD). However, diplomats from other former Yugoslav republics serving in Slovenia often note that one of the issues burdening their Slovenian colleagues is that, though the country is successful, its small size precludes its recognition internationally, as symbolized by uninformed observers who conflate it with Slovakia. However, there may now be an opportunity emerging that will put Slovenia on the map – namely, the industry sectors of cryptocurrency and blockchain technology. Over the past several years, we have seen the blossoming of these industries in Slovenia, propelled by both the Slovenian government and the Slovenian business sector, which wants to establish Slovenia as among the leaders in these rapidly expanding markets. Slovenia should therefore be on the radar of investors interested in the development of these new technologies and the commercial opportunities that go along with it.
In 2011, as the Syrian government was violently addressing demonstrations and thus paving the way for the notoriously violent Syrian Civil War, the Arab world decided to sever its ties with the Syrian regime led by Bashar al-Assad. In support of the opposition, the members of the Arab League decided to suspend Syrian membership in this organization and impose economic sanctions on the regime in Damascus. In 2012, the Organization of Islamic Cooperation also suspended Syria’s membership. That same year, Saudi Arabia severed its diplomatic relations with Assad’s Syria, and many other Arab countries followed suit. However, as the Assad regime is emerging as the victor of the violent civil war, these Arab countries are starting to embrace Assad’s Syria as a way of opposing non-Arab regional powers that operate in Syria –namely, Iran and Turkey.
Ever since China opened itself to the outside world and joined the global economy, its national economic growth has been nothing short of miraculous. Between 1989 and 2018, the average Chinese annual growth rate was 9.58 percent; however, as of December 2018, China’s year-on-year advancement was at 6.4 percent. The set of factors that have affected this change are numerous and multi-faceted, and they include demographics, the transformation of the Chinese economy into a system with market driven prices, the decline of Chinese exports, and the trade war with the US. This slowdown will negatively impact the world economy, given that it was Chinese growth that prevented the world from sliding into a global recession. The slowdown also generates a more unpredictable and less promising environment to possible investors. In addition to its effect on the global economy, the Chinese economic slowdown also brings great uncertainty to the country’s political future.
Ever since its formation as an independent state in 1947, Pakistan has seen its share of adversity. Wars and rivalry with India have become more toxic since the two countries acquired nuclear weapons in 1998. This has become an integral part of the country’s history and daily experience, along with the conflict in Afghanistan, struggles with Islamic extremism, military dictatorships, and tackling socio-economic troubles. One can say that Pakistan has always been on the verge of becoming a failed state. However, Pakistan currently faces a challenge that truly threatens to send it over the edge. Namely, the country’s depletion of drinking water has the potential to endanger its economy and security. As a result, this country of over 200 million people, armed with nuclear weapons in one of the most geopolitically sensitive regions in the world, could face a new crisis with an unpredictable outcome.
A new partnership is emerging between Russia and Iran that includes political, security and economic dialogue. This new partnership has been the product of regional and global circumstances that brought the interest of the two countries into alignment. This relationship should be taken seriously as the two countries are geopolitically pivotal countries in Eurasia and their partnership has global ramifications, despite the limitations extant in this relationship.
The term “failed state” usually refers to a country whose state apparatus is not capable of effectively controlling and policing its territory, and is unable to provide basic social and public services to its citizens. These types of states are generally characterized by rampant corruption and socioeconomic plights. However, they also become generators of internal conflicts, organized crime, terrorism, refugees, and arms proliferation, among others, thereby impacting the well-being of their neighbors. Failed states are usually associated with places like Afghanistan and sub-Saharan Africa, as well as with the conflict-ridden countries of the Middle East and North Africa, such as Yemen and Libya. The year 2019, however, has the potential of adding another country to that list. This country, however, lies in South America, as thanks to political mismanagement, Venezuela has started moving in the direction of being a failed state. This lies in great contrast to its days as one of the wealthiest countries in South America.
Jack Ma, the co-founder and chairman of Alibaba Group, the Chinese conglomerate with a presence in diverse sectors, including internet, e-commerce, and retail, is one of the symbols of Chinese economic success. Indeed, Ma was named China’s richest man by Forbes magazine and also numbers 20th on the list of the world’s richest people. Alibaba Group is ranked number 300 on the global ranking of Fortune 500. However, on 26 November 2018, Jack Ma, was revealed to be a member of the Chinese Communist Party. This information was brought to light by a newspaper of the Chinese Communist Party, which identified Ma as being among a group of people deserving of reforming and opening China.
The Islamic State is no longer characterized in the media and among security policy specialists as the greatest security threat emanating from the Middle East. In 2017, the Islamic State suffered some of its worst defeats. First, Iraqi security forces took over its biggest stronghold in the Iraqi city of Mosul. Soon after, it lost its capital, the city of Raqqa in Syria, under the offensive of US-backed forces. Since September 2018, one of the group’s last strongholds in the Syrian city of Hajin has been under attack by a US-backed coalition. However, while it may appear that we are seeing the end of the Islamic State, this terror group will likely return, as those who diagnose its demise neglect its history of adapting. Moreover, social forces in the region provide a fertile ground for its return.
As of 2017, the global financial system has become exposed to stricter financial regulations through the European Union’s “4th Anti-Money Laundering Directive,” the Canadian Financial Action Task Force (FATF), and the U.S.’s finCEN and its “Customer Due Diligence (CDD) Requirements for Financial Institutions” rule. These were brought forward after a series of offshore document leaks over the past two years, it is apparent that close to 10 percent of the global GDP is actually “hidden” in offshore jurisdictions and tax havens.
Egyptian president Abdel Fattah el-Sisi’s four-year-long rule of Egypt has been marked by a campaign of repression that has now reached his own government. Following the military coup in 2013, Sisi arrested or exiled Islamists, youth activists, leftists, liberals, authors, and even comedians. Earlier in 2018, however, Sisi turned his attention to regime loyalists in preparation for the presidential elections.
Traditionally, the relationship between Iran and Pakistan has been formal and friendly, though with differences on major strategic issues. The appointment of the new Pakistani Prime Minister Imram Khan, former cricket player and social conservative, led many to believe that Pakistan will form a closer relationship with Iran. This notion became even stronger when Iranian President Hassan Rowhani telephoned Khan to congratulate him on his election, while Khan accepted the invitation to visit Iran at some point. Wider regional developments are forcing the two sides to reinforce their ties, although they are far from any high-profile partnership.
Europol’s European Cybercrime Center hosted a conference in June 2018 discussing virtual currencies and how to foster the legitimate use of this monetary system that is frequently abused by hackers, international drug dealers, and organized crime movers. Since then, there has been a big push to monitor cryptocurrencies. But what is the realm of possible? While there are currently no cryptocurrencies that are fully untraceable, the technology is advancing rapidly. As such, it is crucial for intelligence agencies to stay ahead of innovation in order to keep their edge over rogue actors using cryptocurrencies.
In this day and age, data has become the most cherished commodity in the world. Massive amounts of personal data are constantly being produced and managed by a growing group of operators across nations, often without any control on the part of individuals. While conventional wisdom has been that data is acquired and owned by companies, the European Union’s General Data Protection Regulation (GDPR) has set to bring that control back to the individuals. Considering this complete regulatory shift, the new order of data management will have the biggest impact on information technologies, artificial intelligence, and big data analytics, all of which are components of operations in the financial industry.