Ecuador, Guatemala: Viva la revolución.
Also: the US, Pakistan, West Africa and Russia.
ECUADOR. GUATEMALA. Viva la revolución.
Left-wing candidates do well in weekend elections.
Bernardo Arevalo won Guatemala's presidential race on Sunday, defeating former first lady Sandra Torres. Partial results late Sunday indicated Luisa Gonzalez would face centrist Daniel Noboa in run-offs to Ecuador's presidential poll.
INTELLIGENCE. Arevalo, son of a former president, is no outsider, but unexpectedly benefited from a chaotic first round, having polled just 0.7% as late as April. His term won’t likely be as dramatic – Guatemala’s problems are deep-rooted – but he has suggested switching diplomatic recognition from Taiwan. China could also gain should Gonzalez win Ecuador’s next round. Her mentor, former leftist president Rafael Correa, brought the country closer to Beijing.
FOR BUSINESS. Guatemala is one of Taiwan’s last allies and a switch would give its politicians fewer reasons to transit the US. Ecuador has grown closer to Beijing, despite, like Guatemala, being long under Washington’s shadow. It’s a shift popular with many. Both countries are victims of drug cartel violence and have a history of opposition to US investment. Ecuador’s vote included a referendum on Amazon oil drilling. Early counts indicated it will be halted.
UNITED STATES. ALLIANCES. Friends in need.
Washington rewards its staunchest allies.
The US, Japan and Korea agreed to enhance cooperation in technology and intelligence after a historic summit in Maryland on Friday. On Monday, Australia finalised a high-tech missile purchase, after receiving US approval in March.
INTELLIGENCE. Despite a waning influence in the developing world –40-odd countries have allegedly sought to join the China-dominated BRICS group – Washington is doubling down on its closest friends. Military spending in Europe, thanks to Ukraine, is at post-1991 highs. Attention in the Pacific, despite irregular presidential travel, is at post-1945 highs. While still speaking of an international community, the US is preparing for a world of geopolitical blocs.
FOR BUSINESS. While allies get access to arms and intel, the US gets a bigger say in how they deal with China. Tokyo and Seoul will be expected to align with Washington on high-tech trade. Despite a thaw in economic ties with Beijing, Canberra is hewing close to the US on critical supply chains. Europe is proving a little more unreliable. Germany said last week it would not meet its previous 2% defence spending pledge. France is showing divergence on Africa.
Written by former diplomats and industry specialists, Geopolitical Dispatch gives you the global intelligence for business and investing you won’t find anywhere else.
UNITED STATES. ELECTIONS. Think global, act local.
Allies watch for inconsistency in Washington.
Donald Trump's rivals hit back on Saturday after the former president boasted of being “the apple” of Vladimir Putin's eye. Russia's UN envoy on Thursday described the war in Ukraine as "the military adventure” of the Democratic Party.
INTELLIGENCE. Foreign policy is usually secondary to US elections, but Biden’s support for Kyiv (and allegations of Trump’s support for Moscow) is becoming central to the culture wars. It’s something that Russia is exploiting in its disinformation campaigns and conspiracy-minded Americans are lapping it up. US allies are watching too, wondering how many policies will survive a change in administration. All politics is local, the adage goes. Increasingly, it’s global.
FOR BUSINESS. Donald Trump’s legal woes are adding to the confusion, as is talk of a third-party candidate or pivotal Democrats, like West Virginian Senator Joe Manchin, becoming independent. Election-year politics is seldom simple. Election-year markets are likewise hard to predict, though historically trend flat to bearish. None of this is good news for Biden, already suffering low ratings and fresh criticism after deciding to take a vacation during Maui's wildfires.
PAKISTAN. Hard times again.
New obstacles for a so-called ‘hard country’.
Pakistan's notionally ceremonial president denied on Saturday he had given assent to two national security laws. Former foreign minister Shah Mehmood Qureshi was detained on Saturday after the alleged leak of a diplomatic cable.
INTELLIGENCE. Despite an ongoing tempo of terrorist attacks, Islamabad appeared to have regained control following a last-minute IMF bailout at the end of June and the arrest of former prime minister Imran Khan on 5 August. The shock statement of dissent from President Arif Alvi, an ally of Khan’s, however, casts a constitutional cloud, particularly as Pakistan is technically in caretaker mode ahead of elections (which in any case may be delayed).
FOR BUSINESS. The arrest of Qureshi casts another cloud, and for the US. The leaked cable suggested US Assistant Secretary of State Donald Lu told Pakistani diplomats “all will be forgiven” if Khan was ousted, giving credence to longstanding accusations of a US-led conspiracy to depose Khan. Pakistan's Karachi-100 share index fell on Monday, though it is still close to highs last reached in 2017. It may fall further if these events lead to renewed unrest.
With the brevity of a media digest, but the depth of an intelligence assessment, Daily Assessment goes beyond the news to outline the implications.
WEST AFRICA. Back from the brink.
Niger and its neighbours find accommodation.
Niger's military ruler said on Saturday the country would return to democracy in three years – an apparent concession to regional leaders who have proposed an armed intervention to restore ousted President Mohamed Bazoum.
INTELLIGENCE. The junta’s statement will be welcomed. The Economic Community of West African States was showing signs of buyer’s remorse after pledging to intervene a day after Bazoum’s ousting. With many of its members barely in control of their own territory, a war in Niger – bigger than France, Spain and Portugal combined – would not only be difficult but would distract from the region’s war on terrorists, who last week killed 17 Nigerien soldiers.
FOR BUSINESS. A war in Niger would also make neighbouring Nigeria’s economic stabilisation under new President Bola Tinubu even more challenging. Recording 24% inflation last week – an 18-year high – Nigeria faces a food price crisis that could undo Tinubu’s recent reforms and add to migration pressures in Europe. In 2022, most asylum seekers crossing the Mediterranean into Italy were from Niger, Sudan, Chad and Nigeria. The trend is set to continue.
RUSSIA. Back to Earth.
Drones crash into Moscow as a probe crashes into the Moon.
The Luna-25 spacecraft collided with the moon's surface and “ceased to exist”, Russia's space agency said on Sunday. Moscow halted operations at two airports on Sunday after Ukrainian drones continued to enter the city’s airspace.
INTELLIGENCE. Russia is making gains at the frontline with Ukraine, yet hits on Moscow and Luna-25’s failure are a propaganda disaster for Vladimir Putin. Yet stark reminders that Russia is unable to do what was common in Soviet times (i.e., running an empire and landing on the moon) do not change the status quo. Putin has solidified his state control following the Wagner Group’s abortive mutiny. His popularity remains high. The ruble’s fall has stabilised.
FOR BUSINESS. Predictions of Russia’s collapse continue to be confounded. Ukraine meanwhile faces faltering military recruitment amid reports of 200,000 casualties and a counter-offensive that US intelligence allegedly thinks won’t work. For now, Kyiv opposes any settlement with Moscow, and new weapons in 2024 may turn the tide, but Ukraine’s economy has collapsed by 30% and its birth rate by 70%. One can defy gravity only for so long.
Emailed each weekday at 5am Eastern (9am GMT), Daily Assessment gives you the strategic framing and situational awareness to stay ahead in a changing world.