Geopolitical risks reshape business strategies as global tensions rise, Lazard says
Five or 10 years ago, people would be talking about geopolitics casually, according to Ronald Temple, chief market strategist at the US financial advisory and asset management firm. 'But now geopolitics are part of board meetings,' he said.
Temple said that geopolitical risks – from the Trump administration's policy shifts to US-China regulatory hurdles and Taiwan-related contingency planning for semiconductor firms – now extend beyond cross-border issues to include domestic policies' global repercussions.
'For example, provisions that were recently included in, and then subsequently removed from, the One Big Beautiful Bill Act in the US could have had meaningful consequences on non-US investors,' he said, referring to Section 899, which proposed increasing income and withholding tax rates on certain individuals and entities from countries that imposed taxes considered discriminatory against US persons.
03:02
US House passes Trump's bill, sending it to White House for president to sign
US House passes Trump's bill, sending it to White House for president to sign
'Many companies have historically thought of geopolitics as an abstract, intellectually interesting topic, but increasingly they are realising that geopolitical risks are part of their day-to-day strategic decision-making.'
Lazard set up a geopolitical risk advisory unit in 2022, six months after Russia invaded Ukraine in late February that year. 'One of my key roles is to work closely with the geopolitical team to try to kind of connect the dots between geopolitics and markets and the economy and companies,' said Temple.
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AllAfrica
an hour ago
- AllAfrica
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If you read the headlines in American and European newspapers, you would conclude that the Alaska Summit failed. It did not. Washington changed direction and abandoned its support for a ceasefire. Here is Trump's official statement: A great and very successful day in Alaska! The meeting with President Vladimir Putin of Russia went very well, as did a late-night phone call with [Ukrainian] President Zelensky of Ukraine, and various European Leaders, including the highly respected Secretary General of NATO. It was determined by all that the best way to end the horrific war between Russia and Ukraine is to go directly to a peace agreement, which would end the war, and not a mere ceasefire agreement, which often does not hold up. President Zelensky will be coming to DC, the Oval Office, on Monday (August 18) afternoon. If all works out, we will then schedule a meeting with President Putin. Potentially, millions of people's lives will be saved.' 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A good result, in this estimation, would be for Russia to surrender or for Putin's government to collapse. Even under dire circumstances, after the fall of the Soviet Union and the collapse of the ruble, with massive unemployment, shut-down factories and crazy-high inflation, Boris Yeltsin, then president, found a way forward, and Russia did not have a civil war, and government institutions started to restore their authority. Yeltsin's administration lasted eight years and was replaced by a more conservative and authoritarian leader, Vladimir Putin. It is very hard to accurately read sentiment in Russia. Generally speaking, the Russians like order and certainty, and dislike war. If there was a hard sense in the Russian public, especially the top echelons of Russian society, that the Ukraine war was a disaster, then one would expect to see evidence that this was the case. When the Russian invasion of Afghanistan went sour, the Russian people, especially the nomenklatura, demanded that Russia's military involvement come to an end. After nearly ten years of war in Afghanistan, the Russian army began to pull out in May 1988, and all the Russian troops were gone by February 1989. Russians objected to the Afghan war mainly because of casualties. Russia suffered some 26,000 killed and 35,000 wounded, far less than the casualties in Ukraine. In the Chechen wars, on Russia's territory, the Russian army perhaps lost 15,000 troops, although official numbers are not available. Regarding Chechnya, research outfits such as the Jamestown Foundation argue that the Russian public supported a negotiated settlement and were against continuation of the fighting. In the end, the Russian army flattened the Chechen resistance and the Russian public remained mostly passive. One of the asymmetries of the Ukraine conflict is the political impact of Ukrainian drone and missile strikes on Russian territory. These attacks presumably are designed to answer Russia's relentless aerial strikes on Ukraine's critical infrastructure, on military targets and in limited cases on civilian targets. But the other side of the coin is the impact of Ukraine's drone and missile strikes in garnering public support for the Russian 'Special Military Operation' in Ukraine. Ukraine's attacks reinforce public opinion in favor of the SMO. It is noteworthy, as illustrated by a recent Gallup poll in Ukraine, that despite the Russian drone and missile strikes, public opinion in Ukraine is turning decisively against continuing the war without a political settlement. Young men and women, in large numbers, are leaving Ukraine to escape the war and military conscription. 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As for security guarantees, despite some who support sending troops to Ukraine, the sad reality is that no European state, let alone the UK, France or Germany, is going to send even one soldier unless they go there as a backup to US forces. Trump has previously said no US boots on the ground in Ukraine, so any security guarantee would have to be virtual, not with troops, or limited to flyovers and satellite surveillance. It is unlikely Zelensky will like a virtual security guarantee, even one with flyovers. Of course, Trump could change his mind, but it would risk his presidency if the net result is US physical involvement in the Ukraine war. It is too bad we do not have a detailed readout on the actual conversation at Joint Base Elmendorf-Richardson. Trump's use of provocative symbols, F-35s and a flyover involving a B-2 stealth bomber, and the lack of the usual protocols (no honor guard and no national anthems), was hardly conducive to a diplomatic encounter of heads of state. Moreover, the use of a military base, explained as a 'security measure,' was inappropriate, but the Russians, anxious to state their case to Trump and intent on showing deep respect for the United States, accepted the venue and the conditions, even the escort of Putin's presidential aircraft by US fighter jets. The view from Putin's window. The bottom line is, at least for now, US policy has shifted. The US and Trump no longer support a ceasefire but want to settle the Ukraine war through negotiations. How long that will take, and even if it is possible, remains to be seen. Meanwhile, the war continues, and for the most part, Russia will continue pushing to take Pokrovsk and to expand the contact line further to the west. Ukraine, already stretched and now with uncertainties on military supplies, is facing a crisis. Stephen Bryen is a special correspondent to Asia Times and former US deputy undersecretary of defense for policy. This article, which originally appeared in his Substack newsletter Weapons and Strategy, is republished with permission.
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South China Morning Post
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