The political shocks that will define 2016

When judging forecasts about 2016, beware of the "continuity bias". This is the temptation to assume that this year will be a bit like last year - only more so. In fact, recent political history suggests that the events that define a year tend to be the big surprises and sudden discontinuities (call them "black swans" or "unknown unknowns", if you must).

At the beginning of 2014, no pundit that I know of was predicting that Russia would annex Crimea or that a militant group called ISIS (Islamic State in Iraq and Syria) would capture Mosul, Iraq's second-largest city. And, at the start of 2015, I cannot remember many people predicting that more than one million refugees would arrive in Germany that year, or foreseeing the improbable rise of Mr Donald Trump in the United States.

All this suggests that the most important geopolitical events of 2016 will also be something that the pundits and politicians are not yet talking about. Predicting the unpredictable is a fool's game - but one I intend to play, nonetheless. The best approach, I think, is to look for potential discontinuities rather than "more of the same".

The best place to look for a sudden surprise in 2016 could be China. One of the keys to Chinese success over the past 25 years is that the government has managed to keep economics exciting and politics boring. That could change this year. President Xi Jinping's anti-corruption campaign is sweeping up some of the most powerful and richest people in China - senior generals, the head of China's internal security service, billionaires, chief executives, television personalities.

All this is taking place against the background of a slowing economy, a crackdown on free expression and widespread public anxiety about pollution and industrial accidents. Beneath the calm official exterior of Chinese politics, the potential for a backlash, either from the public or from some of the groups threatened by the anti-corruption campaign, is surely growing.

Of course, the safe bet is that President Xi will still be in place this time next year. But if the Chinese leader's position does come under threat this year, the pundits will swiftly queue up to explain why, in retrospect, it was obvious that something had to give.

This year, the election of Mrs Hillary Clinton as US president would represent continuity. She is a known quantity, favoured by the US establishment, well-funded and ahead in the polls. The "continuity bias" is also leading almost all pundits to dismiss the presidential election chances of Mr Trump. History suggests that candidates like Mr Trump eventually always crash and burn.

But such analyses involve discounting the possibility that the rise of Mr Trump is a symptom that something fundamental is changing in the US. It also entails discounting the truly impressive opinion poll lead that "the Donald" has built up in the race for the Republican nomination. I am enough of an establishment creature to find it very hard to envisage Mr Trump winning the presidency itself. But I believe the polls that suggest that he is favourite to be the Republican candidate. That, in itself, would be a political earthquake.

The big discontinuity in Europe this year would be if Britain defied conventional wisdom and voted to leave the European Union (EU). The bookmakers still place the odds of Brexit at about one in three - and they are an unsentimental bunch. But set against this, the economic and political backdrop for a British referendum on Europe is distinctly unpromising.

The EU is a tough sell at the moment. It is struggling economically, is politically divided and cannot agree on a strategy to deal with the refugees and migrants coming into Europe. That plays directly to Brexit supporters' most politically potent issue - immigration.

A lot of political forecasts about Europe outside Britain are also based on the assumption that the EU will find an effective strategy for the refugee crisis this year. But that looks like wishful thinking.

The objective factors driving refugee flows - war in the Middle East, the hope of a better life in Europe, the profits involved in people-smuggling - will all still be there this year.

If refugee flows continue at current levels or even intensify this year, then the political effects on the EU could be quite dire, threatening the position of Chancellor Angela Merkel in Berlin, and creating deeper divisions between Germany and its European partners.

Is there anything that could go unexpectedly right in 2016? Absolutely. One strong possibility is that ISIS will suffer serious military setbacks over the course of the next 12 months, at least in Iraq and Syria. (It may continue to expand in Libya and North Africa.)

The horror provoked by the terrorist attack in Paris in November served to disguise the fact that the militants have actually been losing territory in recent weeks and months. The Iraqi army, backed by Western air strikes, has just succeeded in retaking Ramadi. Over the course of this year, it should make further gains and might even manage to push ISIS out of Mosul.

The bad news, however, is that if ISIS loses ground in its heartland, it will have more incentive to strike back with terror attacks in Europe. The opening days of 2016 have already seen alerts in Munich and Amsterdam. The threat of terrorism is, sadly, one area where I think it is safe to bet on continuity in the new year.

THE FINANCIAL TIMES

A version of this article appeared in the print edition of The Straits Times on January 07, 2016, with the headline 'The political shocks that will define 2016'. Print Edition | Subscribe