12 Predictions For 2013

From the Senkaku/Diaoyu dispute, the forthcoming Israeli elections, and the health of the EU, Frazier Fathers makes 12 predictions for 2013…




1)  Shots Fired in the Eastern Seas?

As the excellent articles by Hsin-Yi Lo (Part 1 and Part 2 ) illustrated, the disputes between Japan and China over the Senkaku/Diaoyu islands are rooted in the two country’s histories. Following the election of the Shinzo Abe’s Liberal Democratic Party many signs point to relations with China over the disputed Senkaku/Diaoyu Islands deteriorating in 2013. In its election manifesto the LDP called for the deployment of “civil servants”  to the islands to maintain Japanese control which of course will elicit a harsh response from China. Whether the new Prime Minister will carry out these election promises remains to be seen but all the pieces are in place for a tense year in the Seas of East Asia.

Prediction: Tensions in the South China Sea and surrounding areas remain high throughout 2013 with repeated clashes (both direct and indirect) between Chinese and Japanese paramilitary organizations (coast guard/police and protesters/fishermen). The tit for tat will continue through the year with escalating intensity and expanding into economic and military realms. That being said, both sides will stop short of opening fire on the other.

2) Bibi 2.0

If the polls are to be believed, Prime Minister Netanyahu’s Likud party appears to be headed to re-election in January. What does this mean for the Middle East? Not a whole lot; the status quo will remain with the Palestinians, the rhetoric over Iran’s nuclear program will continue (more on that later) and relations with Israel’s neighbours will remain frosty at best. Nothing will change and the Middle East will spend another year in purgatory.

Prediction: Settlement construction continues, peace process remains derailed, rocket attacks from Gaza remain a threat and relations with Washington, Europe and the rest of the Mid-East remain on ice.

3) Off the Cliff or into the Ceiling?

Although the negotiations between President Obama and House Republicans to avoid the potentially disastrous consequences may result in a deal before the January 1st cliff, this will not be the end of the US budgetary clashes. According to many estimates, the United States government will reach the $16.4 trillion debt ceiling sometime in the first quarter of 2013 after delaying tactics by the treasury. It is unlikely that any debt deal struck in the final days of December will be forward thinking enough to resolve this debt ceiling issue and as result American politics will likely immediately fallback into partisan deadlock after a brief detour for a gun control debate.

Prediction: President Obama’s agenda in almost every major policy area will be stuck in gridlock as Congress’s dysfunctional characteristics continue through 2013 towards the Midterm 2014 elections.

4) Gaddafi 2.0

Most current reports state that Syrian President Assad is damned if he does and damned if he doesn’t. He is slowly losing the civil war – meaning eventually the rebels will get their hands on him and he will, if he is lucky, face a farce trial and be sent to the gallows. If he tries to make a break for freedom, it is likely that his Alawite allies will attempt to hand him over to the rebels in order to save their own skin. Either way things are bleak for Assad; more or less any scenario short of a NATO invasion and his capture by Western forces will result in the current Syrian President meeting an end that could match the grizzly end met by the late Colonel Gaddafi. This of course leaves the question of what happens next.

Prediction: President Assad meets a grizzly end, either at the hands of the rebels or his former supporters. After Assad is removed sporadic fighting continues as sectarian groups battle for supremacy as the Syrian National Council struggles to project power across the country.

5) An Islamist Paradise

2012 saw northern Mali seized by radical Islamist forces as fellow TRS contributor Peter Kelly provided insight on in his piece this past fall. Unfortunately a quick resolution to this situation seems less and less likely as US UN Ambassador Susan Rice was quoted as stating that the French intervention plans for Mali were “crap”. Even with a UN resolution passing on December 20, most experts predict that forces would not actually be ready to engage the Islamist forces until September or October. What this means is that for the next 8 to 10 months the region will continue to deteriorate, radical Islamist forces will be able to dig in and implement their harsh interpretation of Islam. The risk of another African refugee crisis erupting and spilling into the fragile neighbouring countries is real and the fact that border security is non-existent in this region means that there is nothing stopping the Islamists from just disappearing into the vastness of the Sahara.

Prediction:The 2013 year sees much of northern Mali still in the hands of Islamist extremists. The intervention, when it occurs, will meet quick success as most of the extremists will disappear into the desert and across porous borders following a short period of fighting.

6) Negotiating with Terrorists

With a June 2014 deadline for the official withdrawal of the majority of US combat troops from Afghanistan. It is clear that if there is any hope of stability for the region the Taliban will need to be negotiated with. In October the ongoing secret negotiations between the US and Taliban collapsed over a proposed prisoner swap. Now the stage is set for potential negotiations between the dysfunctional Afghan government and the Taliban in 2013.

Prediction: Attacks on NATO personnel and Afghan government personnel and facilities will continue with the annual “Spring Offensive” being particularly bloody. Negotiations will continue behind the scenes setting the stage for the 2014 elections where the Taliban will be on the ballot.

7) A Bigger but not Better EU

July 1, 2013 sees Croatia join the happy club that is the European Union. This is the same club that is expected to hover about 0% GDP growth over the year. Although Germany, the Baltic and Nordic nations continue to have strong finances and growth, they will continue to be dragged down by worries over Greek, Italian and Spanish debt. Although an agreement was reached over EU financial regulation and banking oversight it is unlikely that this will be enough to stabilize the union’s economic woes. The pivotal moments for Europe will likely come in the Italian and German elections which are set for February and September respectively. The outcome of these elections will likely determine the fate of the European Union.

Prediction: Pro-European centrist governments will manage to maintain power in both Germany and Italy but racial and ultra-national parties like the Five Star Movement will make large gains resulting in increased political instability and a channel for vocal opposition.

8) The Thin Red Line

Despite condemnation from the UN and Benjamin Netanyahu’s drawing red lines, 2013 appears to be when decisions need to be made. Of course, the red line was supposed to come in 2012 and before that in 2011 and the year before that. Why are the summer and fall of 2013 so important? First in March of 2013 both the IAEA and the various branches of US intelligence services are due to present reports on the status of the Iranian nuclear program to their respective governing bodies. Even if these reports are damning it is unlikely that any action will occur before the Iranian presidential elections that are set for June. Since President Ahmadinejad is term limited he will be replaced and the question becomes by whom, and with the backing of which mullah’s and governing faction will the new president come. Should a repeat of the 2009 election occur it is very unlikely that the US or Western powers will remain silent as Iranians protest in the streets. But if a new hardliner president is elected, and the nuclear program remains on track, strikes of Iranian nuclear facilities will likely move to the forefront.

Prediction: If a perceived hardliner wins the Iranian elections, air strikes will hit Iran’s nuclear facilities before the holiday season of 2013. If a “reformer” wins, 2014 will become the new “Red Line”.

9) What Global Warming?

Following “super storm Sandy” global warming once again moved back into the psyche of the American people and there was renewed hope that climate change would move back onto the policy agenda. The annual UN climate change talks in Doha this past November produced much talk but no actual agreement or actions beyond meeting and agreeing to meet again before the 2015 deadline. 2013 won’t change much either. As politicians all continue to struggle to restart the world economy, it would be foolish to expect any movement on the climate change file from any major CO2 producer.

Prediction: Another bad weather year around the world has people talking of climate change; no government from the major CO2 producing nations takes any concrete action.

10) Farewell Hugo

From personal and family experience I know that battling cancer is one of the toughest fights in a person’s life. Unfortunately for Venezuelan President Hugo Chavez, two cancer surgeries and the follow up complications which involved internal bleeding generally do not point to a good recovery. Even after recovering from surgery, President Chavez still likely faces chemotherapy or radiation treatment and likely at minimum several months of being largely unable to lead on a day to day basis. The fact that a successor has been chosen is an unfortunate sign that Chavez’s days as President could be numbered and what that means for Chavez’s socialist movement in Venezuela and other leftist movements in South and Central America is a question that will play out beyond 2013.

Prediction: President Chavez transfers power to his Vice President by the summer as persistent cancer treatments have him out of the country and unable to fulfill his duties.

11) Argentina Hits Rock Bottom…Again

In 2001, Argentina was bankrupt. Today, Argentina has become a key player in the international commodity markets while its exports have doubled from the $31 billion in 2001 and, if you listen to the government claims, all is well within the country. But things are not as good as they appear. In January it is expected that IMF will decide whether or not to censure Argentina over the reporting of inaccurate inflation and economic data. Since 2007, official inflation levels have averaged 8.8%, but many private and international economists peg it at approximately 20%. The government of Cristina de Kirchner seems prepared to continue its economic policies, including the nationalization of major foreign companies.

Prediction: The economic downward spiral of Argentina continues in 2013 as inflation continues to pressure the spending power of the average Argentinian. Meanwhile foreigners continue to fear additional nationalization of foreign companies in the footsteps of the Spanish oil company YPF, as a result FDI begins to decline.

12) Challenging the Dear Leader

With the election of President Park Geun-hye in South Korea, 2013 will see how Kim Jong-Un responds to his new female counterpart. Although Park has pledged to attempt to reengage North Korea, the recent rocket/ballistic missile launch and signs pointing to preparations being made for a nuclear test the question is whether the new Kim will attempt to engage with the South or continue to show his strength in 2013.

Prediction:  The first half of 2013 is relatively quiet from the North Koreans. But they start the summer with a bang by testing a nuclear weapon.


Photo credit: John “Pathfinder” Lester

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