As North America and other parts of the world have recovered from the financial crisis, other nations have barely felt it which could result in political instability, says Carl L. Tannenbaum, chief economist at Northern Trust. Speaking at its ‘Still Searching for a New Normal: The Global Economy in Transition’ session, he said that geopolitics tops the list of risks to the global economy. The system now faces stern tests such as Russian aggression towards its neighbours, the UK referendum on EU, and the rise of radical Islam. In some cases, such as Europe, younger people cannot find jobs which may prompt them to leave or, worse, turn to extremism. The global economic co-operation that was initiated to reduce conflict may be fraying a bit and some leaders in some countries are questioning whether it is a good thing. And North America needs to watch this because the failure of some markets will impact the U.S. and Canada.
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