In this third part of our series on the effects of Climate Change in the Balkans, future political, economic and social scenarios are summarised from the Report, available through the Shadow Governance Intel Report Store. This summary presents the key scnearios likely to emerge in the region as a result of Climate Change and the impact it is already having. This analysis also highlights how this phenomenon can reinforce, or undermine, the current authoritarian trends amongst the ruling elite in the Balkans.
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There are strong indications that the Balkan peninsula is beginning to witness significant environmental, economic and political implications from its exposure to climate change. This analysis is a summary of a more extensive report to be released by Shadow Governance Intel on the impact of climate change on the Balkan countries – now, and future scenarios. In addition to the obvious environmental impact, the biggest concern is whether the fallout from climate change will have a detrimental impact on the political stability of an already-fragile region.
Although the Bulgarian banking system is generally dominated by international banks, a small part remains under the control of indigenous entities, some of which remain open to allegations of questionable practices and associations. There are concerns that the largest of the country’s domestic banks will contribute to wider industry instability if they continue to be regarded as politically exposed, and open to providing politically influenced loans regardless of their commercial viability.
Energy systems play a key role in the global phenomenon of climate change. The lack of modernisation and renewal of these system not only aggravate the effects of climate change, but it also has a direct impact on the population, which is exposed to higher levels of pollution. Governments in the Balkans have arguably neglected to make necessary legal changes to protect the environment, a factor that is ostensibly aggravating the exposure of this region to this global phenomenon.
2018 is expected to be a year of consolidation in Bulgaria's banking sector. New laws and transparency requirements have been implemented in this economic sector, with the hope that these initiatives will reduce allegations of questionable activities associated with the country's banking sector. This is particularly the case with locally owned banks as they seek international investment.
Turkey’s banking sector is crucial to the success of the AKP and President Erdogan. Although the sector itself primarily functions independently of government interference; there are growing concerns that it is becoming increasingly exposed to informal mechanisms of political influence. This is a summary of a report available in the Shadow Governance Intel Store, that looks at how political exposure plays out in Turkey’s banks, and assesses the repercussions this can have on the future viability and reputation of the sector going forward.
International investment in the TRNC tourist sector is impacted by the fact that the TRNC remains solely recognised as an independent territory by Turkey. In addition to this political factor, scarce energy and water resources increase the costs associated with investing in tourism. This predicament, however, has interestingly facilitated the emergence of informal investment opportunities for smaller entrepreneurs.
2018 will see Russia and China further consolidate their presence and influence in the government offices and markets of Emerging Europe. Beijing and Moscow have marked clear goals for the next year – filling the void left by a retreating EU. As a result, we will continue to see the erosion of democratic institutions and accountability, and a further rise in quasi-autocratic leadership not afraid to use informal tools of influence to consolidate their power.
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Authoritarianism, corruption, human rights violations, and political repression are elements that characterise political trends in Emerging Europe over the next year. Indeed, countries in the region will continue to move away from democratic reforms, while their ruling elite continue to secure their political power by leveraging informal mechanisms of influence.
Although the current economic standing of Belgrade’s Airport is good, the Vučić government is - yet again - close to endangering one of the most important state assets. Previous regional examples reveal how governments, for political purposes, have privatised state assets to the detriment of public coffers, and the case of Belgrade Airport could easily follow this path.
The negative demographic trends witnessed in the Balkan countries is an underreported topic with harmful effects on regional economic dynamics. The demographic factor is central to understand and predict economic development in the region, as structural problems such as labour shortages, pension funds, and higher pressure on public services, are already appearing, and will have an impact on the type of foreign investment the region can attract.
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Bosnia is witnessing steady political disintegration. A lack of political legitimacy of its borders, an unclear EU policy, and re-emergent nationalist ideologies are aggravating ethnic and religious divisions. On top of all of this sits a murky nexus of rent-seeking political leaders, dependent oligarchs and a commercial environment threatened by corruption and undue political influence.