Mid-Year 2024 global election reflections

Summary

Politics have been in focus over the first half of 2024 as many systemically important emerging market countries have hosted elections. While opportunity for widespread policy change was present earlier this year, in our view, the main takeaway from most elections has been the high likelihood of continuity of already existing policy. Across Asia, elections in Indonesia, Taiwan and India are not likely to result in significant policy adjustment. In Latin America, Morena outperformance has generated initial local markets volatility; however, we believe that, at a high level, policy continuity will prevail and material policy change is not likely to materialize even if Morena secures a congressional supermajority. South Africa, however, is the one country that does not fit the policy continuity theme. The direction of local policy will change; however, we take comfort in our view that a market-friendly coalition is likely to prevail and policy change in Africa's most industrialized nation could result in a more business-friendly landscape.

2024 global political and election update: Continuity prevails

Over the last few years, geopolitics and politics have become important considerations when trying to assess the overall direction of the global economy and financial markets. Military conflicts in major economic regions of the world have contributed to inflation pressures, slower growth and sporadic bouts of financial market volatility. Perhaps more concerning is that military conflicts between Russia & Ukraine as well as Israel & Hamas have not reached steady states. Much uncertainty around the direction of both conflicts remains, and the risk of escalations remains ever-present. Earlier this year, we highlighted the significant amount of elections taking place against this geopolitical backdrop in 2024. In fact, the first report we published in 2024 touched on the intersection of geopolitics and politics, and focused on the potential for policy change that could take place around the world this year due to numerous elections. We highlighted how countries that account for over 40% of global economic output would be hosting a general election in 2024. Of countries that hold “free and fair” elections, we estimated nations contributing to a little over half of the global economy would head to the polls this year. Half-way through the year the majority of these elections, particularly in emerging market nations, have taken place. And while important elections are still scheduled for the second half of this year, especially in the United Kingdom and United States, a recap of the main takeaways from the most notable elections of the year is worthwhile.

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