Latest news with #politicalinstability
Yahoo
2 days ago
- Business
- Yahoo
Fall of Mongolian coalition government could lead to severe economic downturn
Mongolia faces a crunch parliamentary vote on Monday which could lead to fall of coalition government New analysis from Mongolian Economic Development Board indicates this could lead to a sharp fall in national income and foreign direct investment (FDI), as well as spiralling inflation Political instability will jeopardise economic progress achieved in the last few years ULAANBAATAR, Mongolia, May 31, 2025 /PRNewswire/ -- As Mongolia's parliament prepares to vote on Monday on whether the country's coalition government should remain in office, new economic analysis warns that the demise of the government could see the size of Mongolia's economy contract by over 20% within six months, and FDI fall by almost 40% year-on-year. Prime Minister Oyun-Erdene called on Wednesday for members of the Great State Khural to decide on whether the coalition government, which has been in place since last June's parliamentary elections, should remain as a way of ending recent political instability. The Prime Minister is due to address the Khural on Monday ahead of a 'confidence vote' – likely to be deemed one of the most important moments in Mongolia's political history since becoming a democracy in the early 1990s. As the vote approaches, new economic data – which can be viewed in full here – produced by Mongolia's Economic Development Board warns of the scale of the economic hit Mongolia could face, namely: A 22% reduction in Gross National Income within six months A 12.2% increase in inflation within a year Year-on-year unemployment rising to 2.5% The Mongolian Tugrik depreciating against the US Dollar by 17.9% by the end of 2025 An 18-point year-on-year decrease in Mongolia's Political Stability Index These forecasts are in line with the experiences of other countries where political instability has had a negative impact on the economy, including following the fall of a coalition government: According to data from the World Bank and other key sources, the coalition breakdown in Estonia caused FDI to tumble from 7.54% in 2021, to 0.74% in 2024, and its economic growth to stall from 7.3% in 2021, to -0.9% in 2024 An international study analysing data from up to 169 countries between 1960 and 2004 has concluded that high levels of political instability are associated with lower GDP per capita growth, particularly due to declining productivity growth and reduced accumulation of physical and human capital Commenting, Dr Batnasan B., Professor at the Business School of the National University of Mongolia and Member of the Economic Development Board, said: "The latest data clearly highlights the potential economic consequences of a collapse in Mongolia's coalition government: a sharp economic downturn, runaway inflation, and a rise in unemployment. "It is entirely appropriate that elected representatives decide who governs the country. But it is equally important that such decisions are made with full access to the facts and a clear understanding of the potential risks. "The Economic Development Board's analysis—combined with lessons from other countries that have faced similar circumstances—presents a compelling warning: all the hard-won economic progress Mongolia has achieved in recent years could be jeopardized if Monday's vote results in increased political instability." This new analysis, as well as precedent from around the world, clearly shows the magnitude of the decision to be taken by lawmakers on Monday, and the jeopardy to the significant economic progress Mongolia has made since the COVID-19 pandemic, including adding $9 billion USD to its economy and increasing GDP per capita by an additional $2,400. NOTES Economic Development Board of Mongolia: Full economic analysis available here: View original content: SOURCE Government of Mongolia Fehler beim Abrufen der Daten Melden Sie sich an, um Ihr Portfolio aufzurufen. Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten
Yahoo
2 days ago
- Business
- Yahoo
Fall of Mongolian coalition government could lead to severe economic downturn
Mongolia faces a crunch parliamentary vote on Monday which could lead to fall of coalition government New analysis from Mongolian Economic Development Board indicates this could lead to a sharp fall in national income and foreign direct investment (FDI), as well as spiralling inflation Political instability will jeopardise economic progress achieved in the last few years ULAANBAATAR, Mongolia, May 31, 2025 /CNW/ -- As Mongolia's parliament prepares to vote on Monday on whether the country's coalition government should remain in office, new economic analysis warns that the demise of the government could see the size of Mongolia's economy contract by over 20% within six months, and FDI fall by almost 40% year-on-year. Prime Minister Oyun-Erdene called on Wednesday for members of the Great State Khural to decide on whether the coalition government, which has been in place since last June's parliamentary elections, should remain as a way of ending recent political instability. The Prime Minister is due to address the Khural on Monday ahead of a 'confidence vote' – likely to be deemed one of the most important moments in Mongolia's political history since becoming a democracy in the early 1990s. As the vote approaches, new economic data – which can be viewed in full here – produced by Mongolia's Economic Development Board warns of the scale of the economic hit Mongolia could face, namely: A 22% reduction in Gross National Income within six months A 12.2% increase in inflation within a year Year-on-year unemployment rising to 2.5% The Mongolian Tugrik depreciating against the US Dollar by 17.9% by the end of 2025 An 18-point year-on-year decrease in Mongolia's Political Stability Index These forecasts are in line with the experiences of other countries where political instability has had a negative impact on the economy, including following the fall of a coalition government: According to data from the World Bank and other key sources, the coalition breakdown in Estonia caused FDI to tumble from 7.54% in 2021, to 0.74% in 2024, and its economic growth to stall from 7.3% in 2021, to -0.9% in 2024 An international study analysing data from up to 169 countries between 1960 and 2004 has concluded that high levels of political instability are associated with lower GDP per capita growth, particularly due to declining productivity growth and reduced accumulation of physical and human capital Commenting, Dr Batnasan B., Professor at the Business School of the National University of Mongolia and Member of the Economic Development Board, said: "The latest data clearly highlights the potential economic consequences of a collapse in Mongolia's coalition government: a sharp economic downturn, runaway inflation, and a rise in unemployment. "It is entirely appropriate that elected representatives decide who governs the country. But it is equally important that such decisions are made with full access to the facts and a clear understanding of the potential risks. "The Economic Development Board's analysis—combined with lessons from other countries that have faced similar circumstances—presents a compelling warning: all the hard-won economic progress Mongolia has achieved in recent years could be jeopardized if Monday's vote results in increased political instability." This new analysis, as well as precedent from around the world, clearly shows the magnitude of the decision to be taken by lawmakers on Monday, and the jeopardy to the significant economic progress Mongolia has made since the COVID-19 pandemic, including adding $9 billion USD to its economy and increasing GDP per capita by an additional $2,400. NOTES Economic Development Board of Mongolia: Full economic analysis available here: View original content: SOURCE Government of Mongolia View original content:
Japan Times
3 days ago
- Business
- Japan Times
South Korea faces a triple challenge ahead of its election
Few countries have transformed themselves as dramatically as South Korea has over the last half-century. A poor, authoritarian country with annual per capita income of less than $400 has become a vibrant and prosperous democracy, with direct presidential elections, peaceful transfers of power and a per capita income of more than $33,000. But South Korea lately has been grappling with slowing economic momentum, rising political instability and an increasingly fragile security environment. Can the country transform itself again and meet these new challenges? Begin with the economy. After decades of rapid gross domestic product growth — averaging over 7% in the 1970s-1990s — the economy has slowed, growing by 2% to 3% in recent years. The growth rate is expected to fall further, to 1%, over the next decade. A key reason for this is demographic decline. With South Korea's fertility rate having dropped to just 0.75 — the world's lowest — its population is shrinking and aging fast. The country is set to cross the 'super-aged' threshold, with more than 20% of the population aged 65 and older, this year. Low productivity growth and high household debt are additional brakes on consumption and investment, increasing the risk of long-term stagnation, akin to Japan's 'lost decades.' It does not help that China is becoming increasingly competitive in sectors that South Korea once dominated, such as shipbuilding, steel, smartphones and, increasingly, semiconductors. More fundamentally, the export-driven model that fueled South Korea's past success is now vulnerable to protectionist trends and geoeconomic fragmentation. Domestic political volatility has risen as well. Corruption scandals and partisan gridlock persist and both Freedom House and the Economist Intelligence Unit have reported signs of democratic backsliding. Former President Yoon Suk Yeol's attempt to impose martial law for the first time since 1980 revealed that South Korea's democracy remains fragile, though the fierce backlash — including popular protests and a vote by the National Assembly to rescind the declaration — also highlighted the resilience of public support for democratic institutions. Mounting security risks further complicate the picture. North Korea, bolstered by deepening military ties with Russia and an enduring strategic alignment with China, has continued its regular provocations, including ballistic-missile tests. Meanwhile, South Korea is grappling with the question of how to approach the escalating geopolitical competition between China, with which the country maintains close economic ties, and the United States, an increasingly unreliable ally. U.S. President Donald Trump's past threats to scale back America's security commitments and cut deals with North Korea have revived calls within South Korea for an independent deterrent capability. Recent polls indicate that a growing share of South Koreans want their country to develop nuclear weapons. While the government remains committed to nonproliferation, the pressure for South Korea to ensure its own security is intensifying. Against this backdrop, South Korea will hold its next presidential election on Tuesday. Whoever wins — whether the progressive or conservative candidate — will have to confront head-on the intertwined challenges of boosting economic growth, implementing democratic reforms and providing strategic clarity. On the economy, a top priority must be shifting from export-led to innovation-led growth. This will require major investments in research and development, as well as support for startups in frontier industries such as AI, biotechnology, green energy and digital health care. It will also require continued industrial policies in key sectors (especially semiconductors, electric vehicles and batteries), together with regulatory streamlining. Revitalizing the underperforming service sector — especially through structural reform and digitalization — can unlock potential growth and help reduce inequality. Labor-market reform is also essential. Policymakers must tackle two features of South Korea's labor market that are undermining productivity and inclusion: its dual structure ('regular' workers enjoy more job security, better benefits and higher wages than their 'nonregular' counterparts) and its focus on seniority, rather than performance, in determining wages. To help offset demographic decline, policies aimed at boosting female labor-force participation, attracting skilled immigrants and retaining older workers are also needed. For example, the government could promote lifelong education and more flexible work arrangements. As for democratic reforms, South Korea's next president should focus on measures to strengthen the National Assembly's legislative capacity, uphold judicial independence and foster a civil society and media culture resilient to polarization and disinformation. The next administration might even consider pursuing constitutional reform, to allow presidents to serve up to two four-year terms (rather than one five-year term). Above all, the winner must demonstrate a commitment to restraint, institutional integrity and inclusive governance, especially by rejecting winner-takes-all politics and engaging constructively with the opposition. Finally, to strengthen South Korea's security posture, the next administration should reiterate its commitment to the alliance with the U.S., while seeking stronger security guarantees — possibly including deployment of nuclear weapons. It should maintain and deepen trilateral security cooperation with the U.S. and Japan, particularly on missile defense and intelligence. At the same time, South Korea should pursue greater strategic autonomy. While it must uphold all alliance commitments vis-a-vis China, it should limit participation in anti-China initiatives and maintain an open economic dialogue with the People's Republic. As for North Korea, any engagement should hinge on a credible, fundamental change in the regime's behavior. South Korea has shown a remarkable capacity for renewal in the past. With wise, unifying leadership that delivers a forward-looking vision that addresses economic vulnerabilities, bridges political divides and strengthens national security, this time will be no different. Lee Jong-Wha, professor of economics at Korea University, is a former chief economist at the Asian Development Bank and a former senior adviser for international economic affairs to the president of South Korea.
ABC News
6 days ago
- Politics
- ABC News
Failed budget vote ends Fiame Naomi Mata'afa's government and triggers early Samoan election
One of the Pacific's only female leaders has lost her grip on power, triggering an early election in Samoa, after failing to pass the national budget in the country's parliament. Samoa's Prime Minister Fiame Naomi Mata'afa conceded defeat on the floor of parliament on Tuesday morning after her government's budget was voted down 34-16. Known as the Pacific's "Iron lady", Fiame will now seek a dissolution of parliament and will lead Samoa as its caretaker leader until Samoans go to the polls for an early election. Her announcement follows months of political instability and infighting between the prime minister and members of her former party, the FAST Party, which expelled her earlier in the year. The expulsion came after Fiame forced the resignation of her former colleague and chairman of the FAST Party, La'auli Leuatea Schmidt, after he was charged with serious criminal offences. Mr Schmidt then isolated Fiame, meaning she was effectively leading the country in minority government. After a series of unsuccessful no-confidence motions — where Fiame's martial status was also questioned — today Mr Schmidt and Samoa's official opposition party, led by former long-term prime minister Tuilaʻepa Saʻilele Malielegaoi, succeeded in bringing about an early election. Deputy head of the Department of Pacific Affairs at the Australian National University, George Carter, said no matter the outcome of the upcoming election, Fiame would leave behind an impressive legacy. "She is a leader who has used all political and traditional capital to bring people together to fight for anti-corruption and built confidence in her public service." Fiame won a groundbreaking election in 2021, ending four decades of rule by the Human Rights Protection Party (HRPP), led by Tuilaʻepa Saʻilele Malielegaoi, becoming the first woman head of government in Samoa. If she were to lose the election, it would make Marshall Islands President Hilda Heine the only remaining female leader in the Pacific region. However, Dr Carter said Fiame's political career was far from over. "Many will watch to see if a new party under Fiame will come forth, so there's still a lot of action and intrigue to come," he said.
Al Bawaba
22-05-2025
- Politics
- Al Bawaba
IS Syria threatens Ahmed al-Sharaa over Trump meeting
ALBAWABA - Instability remains in Syria despite the fall of the old regime, which was led by Bashar Assad and the appointment of Ahmad al-Sharaa as interim president of Syria. Recently, Syria has witnessed a significant escalation in threats from the Islamic State (IS/Daesh). The group's threats are not limited to field operations, but also include media attacks and public incitement against the new Syrian government. Through its weekly newspaper, Al-Naba, the Islamic group attacked Ahmed al-Sharaa after his meeting with US President Donald Trump in Riyadh, during which the US president lifted all sanctions on Damascus. However, the organization considered that "the picture has become clearer" after this meeting, stressing that al-Sharaa's ideological disagreement with the organization is not political or partisan. But, IS added in the statement shared on its newspaper that by reviewing the sequence of events that started with Iran's expulsion from Syria, represents "a single package on the international bargaining table," which can be shortcut by the "war on Islam and the protection of international interests," accusing Syrian President Ahmed al-Sharaa of replacing the "Millat Ibrahim" (referring to the Islamic religion) with the Abraham Accords.
