As 2024 approaches its end, Bismarck Rewane, CEO of Financial Derivatives Company, has outlined the top ten global trends expected to shape 2025, offering insights into potential economic, geopolitical, and technological shifts.
America’s Pivotal Choice
Donald Trump’s anticipated return to power is poised to redefine global dynamics, with tighter immigration controls, a protectionist trade stance, and heightened geopolitical risks. Rewane predicts this could fuel tensions, disrupt global trade, and possibly spark nuclear proliferation, signaling a significant period of uncertainty.
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Broader Disorder and Geopolitical Rivalries
America’s transactional foreign policy under Trump could embolden adversaries like China, Russia, Iran, and North Korea to take bolder actions. This environment of “broader disorder” could lead to destabilising activities worldwide.
Trade Wars and Tariffs
With the possibility of escalating tariffs and restrictions, Rewane foresees a deepening trade war, not only between the United States and China but potentially involving America’s allies. These moves could strain global trade relationships and impact economic growth.
Voter Expectations and Political Shifts
The year 2025 is projected to be a period of reckoning for many global leaders, as citizens demand the fulfillment of campaign promises. Failure to meet expectations could trigger unrest in various regions.
Clean-Tech Revolution
China is expected to spearhead a clean-tech boom, with innovations like solar panels and grid storage outpacing projections. This shift could redefine energy markets and accelerate the global transition to sustainable energy.
Economic Adjustments in the West
Western economies face tough decisions on balancing fiscal deficits through a mix of higher taxes, spending cuts, and growth-focused initiatives. Inflationary pressures are expected to persist, influenced by supply chain shifts and tight labor markets.
Artificial Intelligence at a Crossroads
The global investment in artificial intelligence is projected to exceed $1 trillion, with a focus on building data centers. Generative AI will drive productivity gains in some economies, although its broader implications remain uncertain.
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Age and Leadership
Debates about age limits for political leaders will intensify, particularly as a burgeoning youth population faces limited job opportunities. This demographic challenge could contribute to instability, particularly in the Middle East.
Challenges in Global Travel
Global mobility could face new hurdles, as conflicts and geopolitical tensions disrupt international aviation and hinder free movement.
Surprises Await
Rewane notes that 2025 may bring unexpected events, ranging from a devastating solar storm to the discovery of ancient texts or even another global pandemic.
Economic Implications for Nigeria
For Nigeria, these global risks hold significant implications:
Green Technology Lag: Limited access to emerging green technologies could slow Nigeria’s energy transition.
Oil Export Challenges: Rising tariffs and trade barriers may reduce foreign exchange earnings from oil.
Market Volatility: Global monetary policy divergence and fluctuating oil prices could destabilise the Naira, affecting trade and investment.
Lower Commodity Demand: A slowdown in Chinese demand could further dent Nigeria’s export revenues.
Despite these challenges, opportunities may arise from easing global monetary policies, which are expected to lower interest rates in advanced and emerging economies between 2025 and 2026. However, Rewane cautions that inflation may remain elevated in the medium term due to labor market constraints and supply chain adjustments.
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Energy and Oil Markets
The ongoing Middle Eastern conflict could drive Brent crude prices upward, but this may be tempered by moderated demand from China. Nigeria’s economy, heavily reliant on oil revenues, will likely feel the pressure of these global trends.
Rewane’s insights highlight the interconnectedness of global events and their potential ripple effects on developing economies like Nigeria, underscoring the need for strategic planning to navigate 2025’s uncertainties.
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