2023 and the world: Grid’s global forecast — from Ukraine to China, conflict zones to climate change

Grid’s Global Team looks at trends, looming nightmares and potential silver linings for the year ahead.

One year ago, even some sophisticated readers — and savvy editors — couldn’t have identified Ukrainian President Volodymyr Zelenskyy in a photo or found Luhansk and Donetsk on a map. It’s doubtful they’d have known what “HIMARS” or “ATACMS” were, or that the largest nuclear reactor in Europe was in Zaporizhzhia, in southeastern Ukraine. We might have needed refreshers on the Budapest Agreement or NATO’s Article 5.

And yet as 2022 ended, Zelenskyy was everyone’s “Person of the Year” and Russia’s war against Ukraine was without question the year’s most consequential global event. It looks certain to be the same in 2023 — for reasons that matter well beyond the battlefield.

As 2023 begins, we are watching other hot spots, most notably the protest movements and regime response in Iran, missile tests (and — likely coming soon — a nuclear test) in North Korea, and the deepening crisis — for women and girls especially — in Taliban-ruled Afghanistan.

And we’ll monitor global efforts to fight climate change, because — to put it bluntly — in the long term, no crisis matters more than the one that puts the planet at risk.

But we begin our look ahead with the item that rated barely a paragraph in last year’s forecast. We begin with the war.

A second year of war

They are the most profound questions the world will face in 2023:

  • Will the war in Ukraine end?
  • If so, when and in what way?
  • And if not, what next for Ukraine and Russia?

The stunning reality is that as the new year begins, a Ukrainian victory is possible. A year ago, some of the world’s sharpest military minds were warning that a Russian invasion would topple Ukraine’s government in a matter of days or weeks. Against the world’s largest army, and with a fickle friend in NATO, what chance did Zelenskyy and his country have?

And yet here we are. The failings of the Russian military, resilience of the Ukrainian people and anything-but-fickle response of NATO were perhaps the greatest surprises on the global stage in 2022. Together, they have left Ukraine with a chance to win.

  • Will Russia make another move against Kyiv?

Some analysts are skeptical, given the Russian military performance in 2022. And a new full-scale assault on Kyiv might harden even the softest among Ukraine’s European supporters. But — like the initial invasion — the fact that a plan might be strategically flawed doesn’t mean Putin won’t try.

On the other end of the spectrum, a different question for 2023:

  • Will peace have a chance?

In the last days of 2022, both sides were talking about a deal.

The problem is that “acceptable outcomes” for Putin — recognition of the four regions he annexed in September and an official cementing of Russia’s hold on Crimea — are non-starters for Ukraine. And Kuleba’s February plan stipulates that Russia must first face a war-crimes tribunal. That’s not happening any time soon.

What this means is that one side will need to pummel the other badly enough to make negotiations attractive. It’s not hard to imagine European support for deal-making — in Paris and Berlin especially — and Turkey, China or India may use their influence with Putin to move a peace process forward. But the year begins with a seemingly unbridgeable gulf between the two sides — and a strong appetite for more fighting.

At which point, other questions come into play:

  • Will sanctions finally bite in Russia, in a meaningful way?
  • Will Russian opposition to the war grow and influence the Kremlin?
  • Will U.S. and European support hold as the war moves into its second year?
  • And — back to that overriding question: How will it end?

In China, “dangerous storms”

“All roads run through Beijing.” That was one headline in Grid’s forecast a year ago. We could reuse it now.

Meanwhile, Xi’s meeting with President Joe Biden at the November G-20 in Bali, Indonesia, offered glimmers of hope for the world’s most important geopolitical relationship. After a yearslong downward spiral, the two leaders managed to avoid vitriol and pledge collaboration — most notably an agreement to resume cooperation in the fight against climate change.

Some of those storms are familiar — a property bubble, sputtering economy and relations with the West — but others are new.

Pike also noted that “how China handles the messy unwinding of zero-covid … could have ripple effects well beyond China’s public health — the nation’s economic growth and perhaps even Xi’s leadership could be called into question.”

For three years, the party messages were hammered home relentlessly: Lockdowns, strict quarantines and other measures were essential to ensure the virus did not spread; and Xi regularly cheered China’s tough response as a model for the world. Then came November’s widespread protests against the restrictions; less than two weeks later, the policy and message were turned on their heads.

The shift may ultimately prove popular, but if the unwinding of zero-covid brings a nationwide public health nightmare, huge questions loom:

  • How will the party explain a high death toll?
  • Given that public protests accelerated the change, will angry citizens be emboldened to take to the streets again?
  • And beyond the public health concerns, what will the covid troubles mean for China’s economy?

In 2021, Xi told his people that “Common Prosperity” would be the defining principle of the party’s rule — a doctrine built chiefly on the promise of a fairer distribution of wealth and better life for his people. Today, it’s hard to see that the regime has delivered.

The hope is that the reopening will reinvigorate the Chinese economy. But all these problems, together with the crisis in China’s property markets and whatever economic consequences come with the covid wave, paint a landscape of anxieties for the year ahead.

Before we leave China, one more note about geopolitics.

As Rudd put it, in 2023 the U.S. and China will have to make every effort to “avoid sleepwalking into crisis, conflict and war.”

Global economy: Food, fuel and “debt bombs”

The war in Ukraine and troubles in China will weigh heavily on the global economy in 2023 — a year that begins with a nasty mix of inflation and recession worries in many corners of the world.

All the knock-on effects of the war — the refugee crisis, the energy crisis, the crisis in the global food supply — remain in play as the year begins. A sudden end to the conflict would help on all those fronts; a war that drags into 2024 would leave the region and the world vulnerable to yet more economic trauma.

Inflation — driven primarily by the war — crossed the 10 percent threshold in the European Union in 2022, and the International Monetary Fund (IMF) reported recently that the price of staples in a basket of countries had risen by 24 percent since 2020. Meanwhile, recession fears persist in parts of the European Union and the U.S. as well.

Meanwhile, in several corners of the developing world, there’s a different economic worry, summed up in a term we first heard in the summer of 2022: Debt bombs.

Kumar wrote that as 2023 begins, “the world is left facing the very real prospect of a series of economic explosions that could affect the lives of tens of millions of its poorest people.”

The fate of the planet

It’s hard to say that 2022 was a good year for the global fight against climate change. All the urgency of the annual Conference of the Parties (COP) meetings (the latest was held at Sharm el-Sheikh, Egypt, in November) wasn’t enough to avoid a conference that struggled to repeat past pledges, and despite the traumas climate change inflicted in 2022 — heat waves and fires in Europe and the American West, drought in China, deadly floods in Pakistan, to name just a few — the world has done little to stanch the bleeding.

The short-term/long-term paradox was summed up in December by Eurasia Group CEO Ian Bremmer: “Take a few steps back and you see a planet that’s moving away from carbon-based energy at breakneck speed, but in 2022 that transition looked anything but smooth.”

These questions, then, for 2023 and beyond:

  • Will the rush to renewables maintain that “breakneck speed”?
  • Will the return to coal be a brief phenomenon?
  • And will that reboot of U.S.-China cooperation pay dividends for the planet?

Leaders to watch

Along with Putin, Zelenskyy and Xi, a few other global leaders will be worth special attention in 2023.

On the global calendar

There are a few things we can forecast with certainty.

We know that 2023 will bring elections in several important nations — among them Nigeria in February, Turkey in June and the Democratic Republic of the Congo in December.

King Charles III will be crowned in May.

The next major climate conference — COP28 — will gather in the United Arab Emirates in November.

Meanwhile, the U.N. says that in mid-April, someone in India will give birth to the country’s 1.43 billionth person — and at that moment India will surpass China as the world’s most populous nation. (How the U.N. knows the timing with such precision, we’re not sure.)

Silver linings?

It’s always good — and never easy — to finish such forecasts on an uplifting note. To that end, here are some of the best scenarios we can imagine.

A deal is done to end the war in Ukraine, or at least to silence the guns, and it is negotiated from a position of Ukrainian strength. Fuel and food prices drop. Inflation ebbs. Other crises start earning a greater share of global attention.

The world benefits from a less turbulent U.S.-China relationship. China gets a short-term benefit from American assistance with the latest covid waves. (This would mark an interesting reversal of roles, given China’s shipments of PPE and other medical equipment to the U.S. in the pandemic’s early days.) Beijing beats back the worst of the covid outbreak, and life in China — along with the country’s economy — returns to something more like normal.

In the rest of the world, covid-19 is no longer the all-consuming front-burner issue it has been.

The race to renewable energy outpaces the backpedaling to coal.

Some measure of reforms come to Iran. Some measure of peace holds in the long-running wars in Yemen and Eritrea.

Finally, perhaps the safest bet for good news comes from the world of sport. Twice in 2022 — at the Winter Olympics in Beijing and soccer’s World Cup in Qatar — global gatherings of sport brought both controversy and thrills. In July 2023, another World Cup — the women’s edition — will kick off in Australia and New Zealand. It’s not too much to hope that this year, we’ll get the thrills, minus the controversy.

Happy New Year.

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