Economics & Peace Weekly

Welcome to the IEP Economics & Peace Newsletter. This week, we bring you curated stories at the intersection of peace, economics, and social progress: trends from the 70 elections of 2024 set to continue this year, relations deteriorate between Pakistan and Afghanistan, Ukraine halts transit of Russian gas to Europe, Indonesia joins BRICS, Honduras threatens to expel US troops, global population pushes past 8 billion.

The trend of political disruption kickstarts again in 2025??

The last year saw?far-right gains and incumbent losses?worldwide. Pandemic disruptions, high inflation from Russia's Ukraine invasion, and mass displacement from conflicts in the Middle East and Africa contributed to global instability.?

There’s no sign of the trend changing to start 2025, with Austrian President Alexander Van der Bellen, a former Greens leader, tasking rival and far-right Freedom Party (FPO) leader Herbert Kickl with?forming a coalition government?after centrists failed to assemble one.

The struggles of the current coalition government has opened the door for the rise of the far-right political party in Austria, with the rise of Kickl and FPO highlighting the shifting political landscape in Europe, where traditional centrist parties are facing increasing challenges, including Germany, where the inability of another ruling coalition government - Chancellor Olaf Scholz’s Social Democrats (SPD), the Greens, and the liberal pro-business Free Democrats (FDP) – to overcome their differences has forced the nation back to the polls next month.

Polls are suggesting the centre-right combination of the Christian Democratic Union (CDU) and its Bavarian counterpart, the Christian Social Union (CSU), are leading, while the far-right Alternative for Germany (AfD) remains the country's second-largest opposition.

In Canada, Prime Minister Justin Trudeau announced he would?step down in the coming months?after nine years leading the nation, yielding to pressure following the Liberal Party's poor performance in pre-election polling, with the incumbent government on track to fall to the Conservatives.?

These developments indicate that 2024’s global trend of political disruption, with electorates expressing dissatisfaction through the ballot box, leave further challenges for incumbent governments and traditional parties to hold power in 2025.

?? This week in Economics & Peace

Pakistan-Afghanistan relations hit new low.?Pakistan conducted aerial strikes on Afghanistan's Paktika province, killing 46 people. Throughout 2024, Pakistani forces?killed 950 militants, whilst 527 Pakistani security forces and 489 civilians died in militant attacks.

Kenya arrests politician at anti-abduction protest.?Kenya's human rights commission?reports 82 alleged kidnappings of opponents?since June's anti-government protests. President William Ruto has pledged to end the abductions to ensure youth safety.

Israel-Hezbollah ceasefire holds despite breaches.?The November 27 truce required Hezbollah's immediate disarmament in southern Lebanon?and Israeli withdrawal within 60 days. Israel has withdrawn from only two of dozens of occupied Lebanese towns.?

Ukraine halts Russian gas transit to Europe.?Ukraine?stopped Russian gas flows to European customers?after a transit deal expired in late 2024. Russia's share of EU pipeline gas has plunged from 40% to 8% since 2023, with Norway and the US now dominating supply.??

Biden blocks Nippon Steel's US Steel acquisition.?President Biden cited security and domestic industry concerns. The decision faces legal challenges and risks straining US-Japan relations while potentially deterring foreign investment.

Indonesia joins BRICS as full member.?Brazil, holding the BRICS presidency for 2025, announced Indonesia's consensus-backed entry to the bloc. The expansion?further strengthens the group of major emerging economies, which includes Russia, India, China and South Africa.

Honduras threatens US military expulsion.?Honduras is reconsidering US military ties in response to President Trump's?planned mass deportations of Central American refugees?and asylum seekers. The potential expulsion from a key US base marks a shift in Latin American relations.

Tesla reports rare annual sales decline.?Tesla's vehicle sales fell 1.1% to 1.79 million units in 2024, marking its?first yearly decline in over a decade?amid slowing global electric vehicle demand.?

Global population reaches 8.09 billion.?World population grew by 71 million in 2024, a 0.9% increase,?slightly lower than 2023's 75 million rise. By January 2025, global rates showed 4.2 births and 2.0 deaths per second.?

Apple settles Siri privacy lawsuit for $95m.?Apple will pay $95m to settle claims it eavesdropped on customers through Siri. Plaintiffs?alleged voice recordings were shared with advertisers?and that the assistant recorded users without the "Hey, Siri" wake phrase.?

??Insight of the Week

?“If we don't fix it, the planet will cease to function and humanity will be in trouble.”??With 40 per cent of the world's soil already degraded, Professor Alex McBratney from the University of Sydney warns time is running out, with 60 per cent of all known species living in the soil, making it is the most biodiverse habitat on the planet.

What are your thoughts on these global developments? Share in the comments below!?

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