The Economist: Predictions for the world in 2025

If anything, 2024 taught us to expect the unbelievable, says Tom Standage, deputy editor of The Economist magazine, and we can expect more of the same this year.

Every year, the magazine looked at trends in a special edition called The World Ahead in 2025.

Uncertainty would be the hallmark of the coming year, along with the implications of the Trump presidency in America (not predicted by The Economist last year) and tariff threats on global trade, Standage told RNZ's Afternoons.

Across the world, a political trend from last year was incumbent parties being kicked out, he said, as governments were punished by electorates for inflation.

"They either lost altogether, or they ended up in coalition or in minority governments.

"So that ends up being a big trend from 2024 that I think sets up a year of expectations in 2025 because you've got these new governments, and they're expected to deliver change - can they do it?"

It's impossible to look forward without considering the implications of a Donald Trump presidency, he said.

"What's incredible about Trump is actually, if you look at his cabinet, if you look at the people he's appointing, it's actually extremely diverse."

New secretary of health Robert F Kennedy Jnr was one example, he said.

"He is to the left of Bernie Sanders on some things. He thinks that corporations are evil. On credit card companies he thinks, and this is a view he shares with Bernie Sanders, that they're making too much money and should be taken down a peg or two."

With hard right appointees in the cabinet this made for an "extraordinarily broad view."

While Trump had floated all manner of off-the-wall intentions, his first term showed what he says is less important than what he does, Standage said.

Consequently, his tough-talking on tariffs could be a bargaining strategy, he said.

"He's going to put 65 percent tariffs on China, except it's going to be 200 percent tariffs for Chinese EVs coming from Mexico, and he's going to do 10 percent on everyone else, except it's 25 percent for Canada and Mexico."

It was a wait and see game, Standage said.

"So, it does look like a negotiating position, but I think we could just spend our whole lives analysing the things he says, and it's exhausting."

Meanwhile, Trump's presidency looms large over the rest of the world.

The last time the US imposed blanket tariffs was in the 1930s with the Smoot-Hawley Act, it didn't end well, he said.

"It led to a global collapse in trade. This is potentially economically very significant. It could reduce growth and increase inflation for the whole world, and it would be bad for America too, by the way."

On the geopolitical side Trump had a "very, very transactional approach to alliances", he said.

"We've got the war in Ukraine, is he actually going to continue to support Ukraine?

"If you look at Asia, if there's some sort of incident in the South China Sea, is he going to stand up to China? Or if China makes a move on Taiwan, is he going to stand up? We just don't know."

This strategic ambiguity is very Trumpian tactic, he said.

"It is sometimes called a strength because you don't know what he's going to do.

"This is sometimes called the 'madman theory' of international diplomacy. But the idea is that because you don't know what he's going to do, maybe if you're Xi Jinping, you'll think twice about doing anything."

But if Trump's bluff is called, it could embolden the likes of China and Russia, he said.

"Trump thinks this sort of ambiguity works as a deterrent and I think it does up until the point where he blinks, up until the point where he seems to let something slide, or he ignores something, and at that point it could just start to sound like empty bluster.

"And the danger there is then America's foes will say, okay, he's not serious about America's commitment to any of its allies."

Predictions for 2025

Old leaders versus young

World leaders were much older in autocratic countries than democracies, Standage said.

"If you look at democracies, actually, the average age of world leaders has gone down a bit in the last 50 years. So where people get to choose their leaders, they do seem to be choosing slightly younger leaders."

However, the US was the democratic exception, he said.

"America has the oldest ruling class, the oldest lawmakers of any democracy. It's a gerontocracy and it's because of the weird nature of the American political system, the gerrymandering of districts, the way the system favours incumbency."

Clean energy

Climate change sceptic Donald Trump had talked about an energy emergency, but the nation was back to oil and gas self-sufficiency for the first time since the 1940s, Standage said.

And despite the President's antipathy to reneawables, clean energy production continues apace in the US and he had only so much power to roll-back clean energy initiatives and subsidies, he said.

"It really comes down to what states do, what cities do, what companies do, and for the most part, they are committed to the energy transition.

"They say this is real, we have to deal with it, and if we just kind of cover our eyes and block our ears, it will come back and bite us."

The golden age of streamers wanes?

A post-covid and writers' strike backlog had meant the streamers were awash with new series last year, he said.

"We really are in a golden age right now where there's just more stuff than you can possibly watch that's coming through, which is great. It's great for viewers.

"But I think we're going to start seeing this year is the rate of new content arriving slowing down a bit, so the streaming is going to become more of a trickle."

Tourism

Europe in particular had seen a backlash against over-tourism and post-Covid numbers showed there had been a significant rebound, he said, with a 50 percent year on year growth.

"That feels really like a very, very dramatic overwhelming number of people whereas previously, before the pandemic, the growth rate was 5 to 10 percent a year."

He predicted in 2025 the growth rate would slow to pre-pandemic levels, while the emerging Indian middle class would be an attractive prospect for tourism destinations looking to grab the travelling dollar.

"We had this with Chinese tourists in the last 15 years or so. But actually, Indian tourists are next.

"And so, we've seen a lot of Asian countries make it much easier for Indian tourists to visit them, because they they're trying to pick up that tourist trade."

Sign up for Ngā Pitopito Kōrero, a daily newsletter curated by our editors and delivered straight to your inbox every weekday.