2017 was a year that many, from across the political spectrum and around the world, just wanted to be over. As Brenda from Bristol succinctly summarised “There’s too much politics going on”. In a year that has (eventually) seen progress on Brexit, a flare up of tensions in the Middle East, and a Trump vs May Twitter spat, many are terrified of what 2018 might have in store.
But what can we realistically expect to see?
Newgate’s Public Affairs team share their predictions for 2018
By the end of 2018 the Tories will have a consistent 5-10% lead in the polls and Theresa May will be being routinely described as the most steadfast – if not the most inspiring or impressive – Prime Minister of recent years.
It will feel like Jeremy Corbyn is miles away from Downing Street and questions will be being raised about whether he ought to be replaced by Keir Starmer. Vince Cable will be pointlessly carrying on…
The Labour Party will continue to drift slowly into support for the UK remaining in the EUs Single Market and Customs Union, further distancing it from much of its core vote. Support for Labour will decline slowly as Theresa May’s personal popularity – based on her steadfastness and immense personal resilience – will rise slowly through the year, with poll support for the Conservative Party following.
The UK economy will continue to grow at the UK trend rate of about 1.5%, buoyed by the services sector and manufacturing exports.
The EU will continue to be a difficult negotiating partner, seeking to punish the UK and humiliate the Prime Minister at every opportunity, but ultimately settling on sensible compromises – at the 11th hour.
The EU Commission will announce a series of steps to further integrate the EU politically. France and Germany will throw their weight behind a European Minister of Finance with the power to review and approve national budgets. Progress, at least on paper, will be made towards a fully integrated EU Military with political leadership from the Commission.
Can President Trump breath fresh impetus into a Middle East peace deal in 2018? Having entrusted his son-in-law Jared Kushner to lead the US diplomatic charm-offensive, the President is expected to unveil a possible road-map before the end of the year. Notwithstanding the international condemnation of his decision to recognise Jerusalem as the indivisible capital of Israel and the intransigence of the Palestinian leadership, there is hope that a Trump Presidency can pull off the “ultimate deal” and deliver an Israeli-Palestinian peace settlement.
Crucial to achieving any peace deal will be the influence of regional neighbours. Saudi Arabia will deepen its ties with Israel as its proxy war with Iran drags on, thawing hostilities between two of the region’s key players. As Iran continues to arm and train militias across the Middle East and Saudi Arabia’s war with the Houthis rages on, expect Riyadh and Jerusalem to forge ever closer diplomatic and military relations.
And will 2018 will be the year that Facebook’s bubble is finally burst? The rising allegations of impropriety during the 2016 US Presidential Election and EU Referendum campaign has ignited a global debate about the influence of the social media giant and “fake news”. New regulation will emerge on both sides of the pond as Facebook faces renewed scrutiny from US and European lawmaker over the unregulated reach of the social media platform.
In English local elections taking place in May, the Labour Party will either hold its current share or increase, as a result of a high-polling Sadiq Khan and renewed left-wing activism.
On Brexit, a transition (or implementation) agreement will be fudged due to the extremely tight deadline of Oct 2018. I believe it will be a ‘status quo’ agreement, as anything else will be too complicated to negotiate while also working on the end state arrangement and new trade deals.
Germany’s political dust will settle on a grand coalition of the CDU’s Angela Merkel remaining as Chancellor supported by the SPD. However, who will get which briefs will take some time, and I wouldn’t expect to see any agreement before the end of January at the earliest.
At the end of the year, we will see leadership manoeuvres from within the Tory party. We should keep an eye on a newly green-Michael Gove, Boris Johnson (who if he continues to navigate the waters as peacefully as he has this week, could actually make it to the end of the year as Foreign Secretary), Jeremy Hunt, Amber Rudd and Gavin Williamson.
I predict that 2018 will be the year that tech conquers the City and financial services finally receives its ‘industrial revolution’, with many jobs and practices in banking, insurance, asset management struggling to adapt to the remorseless rise of technological innovation, automation, AI and big data.
Of course, the emergence of fintech has been visible for a while, but I think 2018 will see it fully enter the mainstream, with potentially dramatic consequences. Trading in cryptocurrencies such as Bitcoin will become available on more stock exchanges (almost certainly creating a bubble). The widespread adoption of Blockchain will undoubtedly affect financial transactions and trading. Financial advisers’ fears of being replaced by AI robots will start to become a reality.
New regulations such as PSD2 will herald the start of the ‘open banking revolution’, where interactions with your bank will become replaced by new smartphone apps designed to manage your financial information. Banks themselves will be at risk of becoming mere utilities as new firms and tech giants, such as Apple and Google, start to monopolise the consumer experience of managing your money.
By the end of next year these potentially disruptive changes will be felt across the sector – and the City of London will start to have a decidedly different look and feel.