The items listed below represent potential emerging issues that our analysts are tracking. These can be long term or short term, but will be updated daily. If an item on our Watch List becomes critical, we will email you a full analysis explaining its significance.
Each Saturday, we will follow up our daily Watch List for each week with our conclusions on these issues.
- U.S.-China: After Donald Trump won the U.S. presidential election, we began a broad analysis of the trade relationship between China and the United States. We examined whether China’s holding of U.S. debt is a significant lever China can use in the relationship. As the next subject of analysis, let’s thoroughly examine the issue of supply chains, particularly those involved in the making of electronics and other goods for which the U.S. currently depends on China. Let’s also look at the extent to which disruption in these supply chains would adversely affect U.S. companies and consumers relative to Chinese producers.
- Iraq-Turkey: In a diplomatic about-face, Iraq says it is “keen” on strengthening ties with Turkey, ahead of a two-day visit to Iraq by Turkey’s prime minister on Jan. 5. Iraq and Turkey have been in a spat for well over a year regarding what Iraq sees as the unlawful presence of Turkish troops within its sovereign borders. Let’s look at what these countries’ interests are in each other to get a better sense of where the relationship stands.
- Indonesia-Australia: An Indonesian military spokesman said that Indonesia has terminated all military cooperation with Australia “due to technical matters.” Let’s find out what that military cooperation previously involved, what the termination means in practical terms and why it happened. Also, let’s determine if this is a permanent situation or simply a squabble.
- U.S.-Turkey: Turkey’s foreign minister said the following about U.S.-Turkey relations: “If you are not supporting us in the most significant operation, then why are you based at the Incirlik Air Base [in southern Adana province]? … The U.S. is an important ally. We have cooperation in almost every field. However, the truth is [we have] a confidence crisis with the U.S.” (Translation via the BBC.) We’ve initiated an internal review of Turkey’s domestic political situation, but let’s also review the U.S.-Turkish relationship and look for new areas of potential tension.
- China: Three small items related to China are on our radar today. They are not necessarily connected but all center on a similar theme. First, in a speech President Xi Jinping delivered last October to party leaders and published by news agency Xinhua on Sunday, Xi accused five of the biggest figures taken down in his anti-corruption campaign of having engaged in “political conspiracies” in addition to corruption. Second, a Chinese official in the city of Panzhihua, in Sichuan province, shot the city’s party leader and mayor before committing suicide. Third, Xinhua reported that at a two-day Politburo meeting that ended on Tuesday, each member had given public loyalty pledges to Xi’s leadership. That the anti-corruption campaign is continuing and accelerating is not new to us, but let’s track these blips to watch for any signs that meaningful resistance to Xi could develop.
- Italy: Digital news site ItalyEurope24 reported that Italy is poised to maintain its position as the European Union’s top bond issuer in 2017, with the gross supply of medium- and long-term bonds set to reach between 255-260 billion euros ($267-$272 billion). Let’s answer a simple question: Who is buying Italian debt?