The current world population is 8.07bn as of Wednesday, November 15, 2023, according to the most recent United Nations estimates elaborated by Worldometer. There will be more than 70 elections in 2024 in countries that are home to around 4.2bn people—for the first time, more than half of the global population are theoretically voting in 2024.
You could argue the key global election in 2024 is in the US, where a tight vote is expected, which will then have severe ramifications given the US standing on the world stage – a few hundred thousand swing US voters could have a huge impact on what comes next for global politics – from climate policy, to Chinese relations, and hopefully the more pressing situations in the Ukraine and the Middle East. President Biden this week spent time with Chinese Premier Xi Jinping in San Francisco to re-open military communications between China and the US. This came at a time that a key Chinese producer of laser sensors for cars, Hesai, said that “hostile” attitudes towards Chinese investment in the US, where they have ditched plans to build a $60m manufacturing plant, will lead to a “xenophobic” environment for Chinese relations that will lead, in their view, to the US losing out on automotive innovation.
There remains much to play for. The clean-energy transition is creating new green superpowers and redrawing the energy-resources map. Lithium, copper, and nickel matter much more, while oil and gas, and the regions that dominate their supply, matter less than in the past. Competition for green resources is reshaping geopolitics and trade, and creating some unexpected winners and losers.
Artificial Intelligence (AI) continues to dominate our minds, with many businesses adopting it, regulators are regulating it and techies continue to improve it. Debate will intensify over the best regulatory approach—and whether arguments over “existential risk” are a decoy that benefits incumbents. Unexpected uses and abuses will keep popping up. Worries abound about AI’s effect on jobs and potential for election meddling. Risks abound as to how the US election can be impacted by foreign nations with a grudge.
UK politics has one again been to the fore this week, with a cabinet reshuffle for the Conservative party. This happened shortly before encouraging inflation data was released, showing UK headline inflation had fallen from 6.7% in September to 4.6% in October, a sharper than expected fall and due mainly to energy prices receding. This delivered on Rishi Sunak’s promise of halving inflation by the year end, just in the nick of time, but that was the only good news he had this week. In light of falling inflation expectations, both bond markets and equity markets have had a better time this week. Goldman Sachs announced that inflation, in their view, is falling more quickly than central banks suggest, estimating crucial US core personal consumption expenditure (PCE) will be at 2.4% by December 2024 – pretty much bang on target.
In brief, it looks increasingly plausible that this tightening cycle has come to an end. It also looks quite likely that the beginning of the subsequent loosening is closer than central banks are suggesting. If that turns out not to be the case, there is some risk that it will come too late to avoid a costly slowdown and even a return to too low inflation. Yet none of this is certain: policymaking is now at a truly difficult point in the cycle. Central banks started tightening too late, but they shouldn’t go on too long just because of that. Timing is key for a successful outcome. Should they get it right, much better times are ahead. Do have a good weekend.