The following Geopolitical Risks have a HIGH probability according to BlackRock.
Increasing heightened tension surrounding Taiwan. China continues to demonstrate willingness to pressure Taiwan. Xi reaffirmed his commitment to unification and signalled no compromise at the Two Sessions in March. China responded to the Taiwanese president’s meeting with House Speaker McCarthy with sanctions and military drills in the Taiwan Strait.
No diplomatic solution in near term. long term political, economical and military stand-off between Russia and West expected. Western support for Ukraine to hold through 2023.
Strategic competition between US and China boosts self-reliance, reduces vulnerabilities and decouples their Tech sectors. US weighing controls on key technologies, including semiconductor export restrictions, quantum and AI. Implementation of stopping outbound investment in Chinese technologies is highly probable. Beijing reinforced the importance of technological self-sufficiency during the recent Two Sessions meetings.
Attacks are increasing in scope, scale and sophistication.
The risk of military action in the region at its highest in a decade. The closer Iran gets to being able to produce and deploy a nuclear weapon, the higher the likelihood of military action against Iran. Domestic pressures in Israel have increased this risk. The Abraham Accords and diplomatic efforts by the U.S. are enhancing cooperation between Israel and Arab states. However, increasing violence in the West Bank and Gaza could bar further progress.
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