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FOCUS: GEOPOLITICS

EXCALIBUR ASSET MANAGEMENT THOMAS POHJANEN,
CEO of Excalibur
Three predictions for 2025
with Thomas Pohjanen READ
MORE ABOUT
1ECONOMIC CHALLENGES IN GERMANY MELLBY GÅRD'S
AND FRANCE GLOBAL PRESENCE
The two major economies in Europe are facing major challenges. ON PAGE 80
Germany held new elections in February, and the new government
has to deal with a stagnant economy, a faltering energy system, Super election year
the need for an expansionary fiscal policy and a challenging
geopolitical situation. Elections were held in 76 countries around
France is in a political crisis, with elections expected after the the world, including the EU, India and the
summer. Government debt is 113 percent of GDP and the current United States in 2024. Time will tell what the
budget deficit is just over five percent. France needs to borrow outcome of these elections will be in terms of
more at rising costs, which is unsustainable. the opportunities for Mellby Gård companies
to do good business.
Monitor:

2Signs that the ECB is buying government bonds to prevent a crisis
in the bond market.

MANY QUESTIONS REGARDING THE US
Will Donald Trump impose higher tariffs, or is his move a means of
improving the US negotiating position ahead of possible bilateral
agreements? To reduce the budget deficit, Trump has promised
large tax cuts while balancing the budget by shrinking and stream­
lining government institutions. How will this affect growth in the
US? US long-term interest rates rose at the start of the year, partly
due to concerns about increased borrowing and the risk of higher
tariffs fuelling inflation.

Monitor:
Will the financial markets have a disciplinary effect on the Trump

3administration? Republicans do not want to see rising interest rates
and a weaker stock market ahead of the 2026 mid-term elections.

RELATIONS BETWEEN EUROPE
AND RUSSIA
Both Russia and Ukraine are starting to show signs of war fatigue.
Can a peace negotiation take place that contributes to a stable
security situation in the future? Russia is likely to want to recreate
a market for its energy exports, while Europe and Ukraine want
to devise restrictions so that Russia cannot threaten other states
on its borders. There is a strong case for Europe taking greater
responsibility for maintaining peace and stability, and defence
budgets will therefore continue to grow.

Monitor:
Will Europe and the US maintain a tough line on Putin? Will the
reconstruction of Ukraine and its economy be financed by a
European equivalent to ‘Marshall Aid’?

The predictions were conducted in December 2024 in anticipation
for 2025.

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