The United Kingdom’s exposure to corruption is rising

Significance This reflects long-standing dynamics linked to the United Kingdom’s role in facilitating illicit global financial flows. In addition, recent political developments under Prime Minister Boris Johnson’s government have fuelled the perception that UK rule of law standards are declining. Impacts Surging real estate prices and increasing wealth inequality facilitate money laundering. Academic freedom in the United Kingdom is potentially impacted by the increase in private donations to universities. The ruling Conservative Party is particularly vulnerable to charges of corruption, given its reliance on private funding.

Subject Brexit outlook. Significance If Prime Minister Theresa May can get the Withdrawal Agreement (WA) and Political Declaration on future relations approved in Parliament this week, the United Kingdom should leave the EU on May 22. However, it remains unlikely that her deal will gain a parliamentary majority, setting up a different deadline. The United Kingdom must come up with an alternative plan by April 12 or face the prospect of crashing out of the EU with no deal. Impacts The United Kingdom could have a new prime minister within weeks; a general election cannot be ruled out. The EU will remain distracted by Brexit as it heads into a season of political change beginning with European Parliament elections in May. As a final option, May could commit to resigning to get support for the WA from Conservative Party MPs.


Subject New UK government agenda. Significance Prime Minister Boris Johnson’s Conservative Party won a substantial majority in the December 12 election by winning dozens of seats that traditionally had been Labour Party strongholds. While Brexit played a crucial role in appealing to first-time Conservative voters, Johnson plans significant investment beyond south-east England to boost the Conservatives’ credentials in the ‘left-behind’ regions of the United Kingdom. Impacts There will be little opposition within the Conservative Party to public-sector reforms designed to improve delivery. The legally binding pledge to leave the EU by December 2020 would increase the chances of a limited EU-UK free trade deal, at best. Poor election results for the DUP and Sinn Fein increase pressure on both parties to revive Northern Ireland's devolved government.


Significance As many as a dozen lockdown parties are now alleged to have been held at Downing Street, significantly damaging Johnson’s support among the public and his Conservative Party. His position as party leader and prime minister is gravely threatened. Impacts Johnson’s domestic troubles, coupled with rising economic concerns, increase the chance of an agreement with the EU over Northern Ireland. Disillusionment with Johnson, opposition to net-zero and culture wars open the door for Nigel Farage’s Reform Party to revive its appeal. Rising inflation threatens to undermine consumer confidence and slow the economic recovery over the coming year.


Significance In a stream of videos posted over four weeks, Peker has accused former and current political figures, some close to President Recep Tayyip Erdogan, of crimes including rape and murder. Silent for weeks, Erdogan has stood by Interior Minister Suleyman Soylu, Peker’s main target, along with former Prime Minister Binali Yildirim. Impacts The scandal may bring down Soylu, once the fuss has abated. The allegations will damage Turkey's reputation abroad as a stable polity. Erdogan’s rule-of-law record suggests elections will not be free and fair and could involve street violence.


Subject The package of reforms on a new EU-UK relationship. Significance The agreement between the United Kingdom and its EU partners sets the stage for the UK referendum on EU membership, which Prime Minister David Cameron has set for June 23. Cameron said he had negotiated new terms that would allow the United Kingdom to remain in the EU. Impacts The deal bolsters the campaign to remain in the EU, but the referendum outcome is still highly uncertain. The deal will only come into effect if the outcome is for remaining, forestalling a second referendum for better terms. If the outcome is for leaving, a new relationship with the EU would have to be negotiated during a two-year transition period. It would also probably lead to a second Scottish independence referendum and UK break-up.


Subject The government's preferred timetable for the UK referendum on EU membership. Significance The EU membership referendum will be a major event in both EU and UK political and commercial life. Prime Minister David Cameron's official position is that the poll could take place any time before end-2017. He is less concerned about the likely outcome of the referendum, which he is confident will produce an 'in' result, than about achieving a margin in favour of membership that decisively settles the question and minimises the damage to the Conservative Party arising from the process. Impacts The most likely referendum date is September 15, 2016. This timetable would make the key renegotiation period the first half of 2016, when the sympathetic Dutch government chairs the EU Council. The German government would also prefer the UK referendum to be dealt with relatively quickly.


Subject Anglo-French agreement to fund the next phase of their collaborative drone programme. Significance The accord announced at the Amiens summit on March 3 between French President Francois Hollande and UK Prime Minister David Cameron commits the two countries to investing 1.9 billion euros (2.1 billion dollars) in the production of Europe's most advanced combat drone. A sophisticated drone programme will be vital to both countries' industrial bases, especially as neither currently has plans to develop a next generation fighter aircraft to replace the Typhoon or Rafale. Impacts Closer industrial cooperation between Europe's most advanced defence powers will strengthen European capabilities. The project will underpin growing cooperation in the defence and security field between the United Kingdom and France. A possible Brexit could affect the relationship, and the United Kingdom might lose out on an increasing EU R&D budget devoted to defence.


Subject The political impact of the 'Panamagate' scandal. Significance A five-member Supreme Court bench on April 20 ordered the constitution of a Joint Investigation Team (JIT) to probe the legitimacy of the offshore assets (mostly in the United Kingdom and Qatar) of Prime Minister Nawaz Sharif and his family. In coming months, the Court bench will monitor and oversee the investigation in which both civilian law enforcement and military intelligence will participate. Impacts The government will avoid challenging the military’s foreign policy this year. The scandal will increase pressure on the political elite to ensure public probity. A military coup is highly improbable at present.


Significance Prime Minister Boris Johnson talks of a “calibrated” China policy that combines toughness in particular areas with continued engagement in others. Impacts Migration of Hongkongers to the United Kingdom in large numbers would invigorate anti-Beijing activism. Chinese investments in UK nuclear power are unlikely to proceed as planned. Beijing’s extraterritorial attempts to suppress dissent in the United Kingdom will intensify. Universities and researchers should expect a push for government-mandated reviews of UK-China research and educational partnerships. Beijing may target particular firms or economic sectors to ‘punish’ London, but most bilateral trade will continue.


Significance The Alliance, led by Prime Minister Pravind Jugnauth, expects to capitalise on two key events: last month’s launch of the first phase of the Metro Express, a 525-million-dollar light railway system part-funded by India that connects the capital Port Louis with outlying commuter towns; and a prospective money-laundering court case against former Prime Minister Dr Navin Ramgoolam, leader of the opposition Mauritius Labour Party (PTr). Impacts MMM fortunes could rest on whether former supporters who abstained or looked elsewhere in the 2014 poll return to the fold. Low crime rates, prime real estate and private education facilities will remain a key draw for expatriates over other African locations. The return of a Conservative government in the United Kingdom would likely see a continuation of current policy on the Chagos Islands.


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