Tuesday, April 28, 2009

‘Expect unexpected in Pakistan, Ukraine, Russia’: Eurasia

Updated at: 1605 PST, Tuesday, April 28, 2009

LONDON: Pakistan, Ukraine, Russia, Nigeria and Mexico are the places where unexpected political change could have the most impact on world markets in 2009, the Eurasia Group risk consultancy said in a report on Tuesday.

In a special report on the world's top 10 "fat tails", relatively low-likelihood but potentially high-impact events, Eurasia Group identified the chance of a military takeover in Pakistan as the most potentially significant unexpected development that might transform global geopolitics.

Other risks outlined included unrest in Russia, collapse in Nigeria and secularists lashing out in Turkey, almost all made more likely by the impact of the global financial crisis.

"Each of these scenarios remains unlikely," Eurasia Group president Ian Bremmer said.

"None of them represent our "call" for any of these countries. But in each case, the impact of the global economic meltdown, has dramatically increased the likelihood of (such scenarios) occurring from 2 or 3 percent six months ago to 10 to 20 percent, or 30 percent in the case Pakistan, now."

Recent "fat tail" events largely unpredicted by analysts would include post-election violence in Kenya early last year or the August war between Russia and Georgia, both of which had dramatic market impact.

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