Continental shifts: The challenges ahead

China eager to build on status as rising superpower

The hair and the bluster may be an American phenomenon. But the U.S. election hangs heavy over Asia, where the spectre of a new U.S. leader stands to realign political order in the region, not least the role of China, a rising superpower whose standing and might are sculpted and defined in no small measure by Washington.

For all the uncertainty and anti-China bafflegab in Donald Trump's rhetoric, he represents a turn toward isolationism, a desire to back the U.S. away from foreign engagement. If a President Trump creates empty space in the international system, China will be eager to fill it. And if Mr. Trump erodes U.S. credibility in matters of economic policy or even respect for human rights, it's a gift-wrapped opening for China to assume a more prominent role as a stable – and sane – global leader. Already, countries like the Philippines and Thailand are falling into China's orbit, while Mr. Trump's criticism of U.S. defence expenditures in Japan and South Korea stand to isolate those long-standing partners.

Hillary Clinton, meanwhile, author of the pivot to Asia, represents a sharper desire for U.S. order, and values, in a region where China has sought supremacy. "People all over the world look to us and follow our lead," she has said. No wonder Ms. Clinton is not well-liked in Beijing. Alarmists say a Clinton presidency would raise the risk of military conflict with China and Russia. That's unlikely. But victory by Ms. Clinton stands to foment a shift from U.S. attempts at amicable collaboration with China to more open tension between the world's most powerful nations.

– Nathan VanderKlippe

Europe's vulnerable banks could have global impact

In Europe, banks matter. They provide more than 80 per cent of the lending to the real economy, well more than double the level in North America. When the European banks fall apart, so does the European economy. Broken banks stop lending, companies get starved for loans and job creation wanes, pushing out the elusive recovery date to who knows when.

Europe has no shortage of sick banks and the next two or three months will probably determine the fate of a few biggies. The ones to watch are Deutsche Bank, Germany's biggest lender and, in the precrisis era, one of the five biggest banks in the world, and Monte dei Paschi di Siena, the world's oldest bank and Italy's third-largest. If either weakens to the point that the mandated regulatory capital cushion vanishes and a bailout is required – they are too big to be allowed to mimic a Lehman Brothers-style collapse – the financial and economic repercussions would be gruesome.

If there is anything the 2008 crisis taught us it's that the big banks are tightly interconnected; shocks are delivered through the global financial system almost instantaneously. Taxpayer-funded bailouts of banks would also give Europe's rising anti-establishment parties, like France's National Front and Cinque Stelle in Italy, more ammunition. Those parties would argue that the financial system favours bank creditors – that is, the wealthy investor class, not the struggling middle and lower classes.

– Eric Reguly

In France, right-wing parties gain strength

As populist parties rise amidst the refugee crisis in Europe, the question on many minds is: How far will this go?

Next year's presidential election in France will go some way toward giving us an answer, with opinion polls forecasting that Marine Le Pen of the far-right National Front will win enough support in the April 23 first round to earn a spot on a May 7 runoff between the top two candidates.

With incumbent President François Hollande, a member of the Socialist Party, lagging badly, Ms. Le Pen's opponent on May 7 will likely come from the right-of-centre Republicans, who will nominate their candidate in late November.

The Republicans' primary is expected to be won by either former president Nicolas Sarkozy, who is hoping to mount a political comeback after being defeated by Mr. Hollande in 2012, or party veteran Alain Juppé, who served as foreign minister under Mr. Sarkozy, and as prime minister under Jacques Chirac in the late 1990s.

Whoever wins, expect a race to the right, with Ms. Le Pen and her Republican opponent battling to outdo each other with tough language about immigration, terrorism and the refugee camp at Calais.

– Mark MacKinnon

Merkel's political future unclear over refugee policy

When Angela Merkel won re-election as Germany's chancellor in 2013, she looked unassailable and was seen as one of the most powerful politicians in the world. But now, as she contemplates running for a fourth term, her position seems far less certain.

Ms. Merkel, 62, is expected to announce in early December whether she will run in next year's national elections and she's looking more vulnerable than at any time during her 11 years in office. Her party has suffered setbacks in several regional elections, her immigration policy is in turmoil, Germany's biggest banks are shaky and Brexit poses a huge challenge to the economy.

The rise of the anti-immigration party, Alternative for Germany, has become a particular threat by tapping into a growing angst in the country about the huge influx of refugees. In response, Ms. Merkel made something of a mea culpa last month, saying she would like to "turn back time by many, many years" to prepare the country.

There are plenty of reasons why she would run again, notably that her party, the Christian Democrats, doesn't have an obvious successor. And while her popularity has taken a hit, her approval rating is still at 54 per cent. Most analysts expect her to run, but the fact that it is even open to discussion shows how far she has fallen in four years.

– Paul Waldie

In Africa, autocratic regimes target opposition movements

Africa's autocrats are under growing pressure from within their own borders. Street protests are on the rise in key African countries such as Ethiopia, Zimbabwe, Burundi and the Democratic Republic of Congo – and the next few months could settle their fate.

So far, the dictators are winning. By ruthlessly wielding the police and military against the dissenters, they have crushed most of the demonstrations. But the protests continue. Security forces are struggling to keep the lid on a boiling pot, and they could lose their grip in the months to come.

In Ethiopia, more than 500 anti-government protesters have been killed since last November, according to human-rights groups. More than 50 civilians were killed in a stampede on Oct. 2 when police fired rubber bullets and tear gas at protesters. Yet the opposition keeps growing, especially among the Oromo people, the biggest ethnicity in Ethiopia.

In Congo, where President Joseph Kabila is trying to extend his rule by delaying elections, several dozen demonstrators were killed by security forces on Sept. 19. Opposition leaders have vowed to persist with their protests over the next three months.

And in the continuing crises in Zimbabwe, Burundi, South Sudan and Gabon, police and soldiers have targeted the opposition, arresting or exiling those who have dared to resist.

The success or failure of these authoritarian tactics over the rest of this year will shape the future of democratic dreams in much of the African continent.

– Geoffrey York

Continuing chaos in Venezuela amidst collapsing economy

Political tensions in Venezuela are rising as the country's economic and social conditions deteriorate. The opposition is pushing to recall President Nicolas Maduro by the end of this year – and given triple-digit inflation, and food and vital medicines scarce all over the country, they will have no trouble gathering the signatures they need to force a new vote.

But regime-allied electoral officials have laid out a timeline that all but ensures that Mr. Maduro's Socialist Party will remain in power until the next regularly scheduled presidential election in 2018. If Mr. Maduro is not recalled before the midpoint of his term, which comes before the end of this year, the law says he will be replaced by his vice-president instead of through a new vote.

The delay tactics allow the Maduro government to placate the international community with the appearance of action while holding on to power. The opposition is split in response: Some parties want to pursue recall regardless, while others say that mass street protest is the only way to try to force change. Mr. Maduro is dug in deep and has already exceeded most expectations of his ability to weather this crisis – but living conditions are so dire in what was, until recently, Latin America's richest nation, that it is difficult to imagine he can hang on to power much longer.

– Stephanie Nolen

New U.S. president faces long to-do list

Twenty-nine days.

That is all the time that remains in the most bitter and unpredictable U.S. presidential campaign in modern memory. On Nov. 8, Americans will select a new leader – and the next president will either be a paragon of establishment politics or a total neophyte to public office who has bragged about grabbing women's genitalia.

The video that emerged last week – in which Donald Trump refers to women in lewd and vulgar terms and describes actions that amount to sexual assault – may be the final blow to his improbable bid for president.

Still, there will be a flurry of campaigning and a last head-to-head debate between Democrat Hillary Clinton and Mr. Trump, her Republican rival, on Oct. 19. The most likely scenario remains that Ms. Clinton becomes the first woman president of the United States. Her pioneering achievement would then turn Bill Clinton into the country's first "first gentleman."

If Ms. Clinton does win, here are some key questions to watch. Will the Democrats also take back control of the U.S. Senate, strengthening the new president's hand? Will the vacancy on the U.S. Supreme Court be filled during the lame-duck session or after inauguration day in January? Will Republicans decide to obstruct Ms. Clinton at every turn, worsening the existing gridlock?
It's hard to imagine Mr. Trump quietly returning to his business activities if defeated. He could question the legitimacy of the election results or continue to attack his rival in an attempt to undermine Ms. Clinton – or simply as a way to remain in the spotlight.

Meanwhile, Ms. Clinton's transition team would work on assembling a cabinet and co-ordinating a hand-off with the staff of President Barack Obama as he prepares to leave office. The new president has a very long to-do list. Some of the most pressing items include tackling a worsening situation in Syria, which means tangling with Russian President Vladimir Putin, and grappling with racial tensions at home.

With the economy creating jobs at a reasonable clip, the U.S. Federal Reserve is likely to raise interest rates in December. It would be the first rate hike since 2015, and only the second increase in a decade. If history is a guide, global financial markets are unlikely to react well to the change. Any prolonged market turmoil would represent an early challenge for the new president.
Of course, if the polls turn out to be wildly wrong, or if something unexpected occurs between now and Election Day, there is still the all-too-real prospect of a President Trump. It's a scenario that is already alarming U.S. allies, not to mention a large proportion of American voters. If by some chance Mr. Trump manages to occupy the highest office in the land, no one can predict what may happen next.

– Joanna Slater