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Welcome to Factal Forecast, a look at the week’s biggest stories from the editors at Factal.
We publish our forward-looking note each Thursday to help you get a jump-start on the week ahead.
North Korea launched hundreds of balloons into South Korea this week, carrying payloads ranging from waste paper to manure. In this week’s Factal Forecast podcast, Senior Editor Jimmy Lovaas and Editor Vivian Wang discuss South Korea’s subsequent scrapping of a military agreement and North Korea’s claimed motive.
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Week of June 7 – 14
A Look Ahead
June 7 – U.S. military training in the Pacific
The 10th iteration of the biennial Valiant Shield military exercise will begin Friday, with Japan’s Self-Defense Forces (SDF) participating for the first time.
What’s happened so far
Considered one of the largest training operations in the Pacific, nearly 4,000 SDF personnel will join U.S. troops for the drill, which runs through June 18 and included approximately 13,000 American service members in 2022. Along with U.S. bases in Japan, Guam and the Philippines, forces will train in the region surrounding Japan and between Japan and the Philippines and the airspace around the Northern Mariana Islands and Palau. The Indo-Pacific Command also intends to test a prototype of its Joint Fires Network, which connects all military branches into a unified system, with the exercises later used to inform the budget and acquisition process in future years.
The impact
This year’s exercise comes as China exerts increased pressure on Taiwan in the wake of the election of Lai Ching-te as president, giving a third-term to a Democratic Progressive Party that maintains the island is already a sovereign nation over a challenger that opposed independence.
June 8 – Macron hosts Biden for state visit
After commemorating the 80th anniversary of D-Day, President Joe Biden will wrap up a trip to France with a state visit in Paris on Saturday.
What’s happened so far
Biden and French President Emmanuel Macron have not always seen eye-to-eye on the conflict in Ukraine. Recently, Macron said he wouldn’t rule out sending troops to the country, whose top commander has approved French military instructors at training centers. Meanwhile, Biden continues to reaffirm his commitment to keep American troops out of Ukraine. The United States, however, recently changed its stance on Kyiv’s use of American weapons to strike Russian territory.
The impact
Biden and Macron may make time to visit with Ukrainian President Volodymyr Zelenskyy, who is expected to be in France at the same time. At a perilous time for Ukraine, the three leaders could announce a way to use frozen Russian assets to deliver billions of dollars and possibly some manpower for the war effort.
June 8 – Israel’s Benny Gantz threatens to leave war cabinet
Centrist and Israeli political mainstay Benny Gantz has threatened to withdraw from the country’s three-man war cabinet by Saturday if a comprehensive post-war plan for Gaza is not agreed upon.
What’s happened so far
Israel’s war cabinet was formed days after the Oct. 7 attacks, as part of an effort to streamline the country’s notoriously unstable politics during the crisis. The current cabinet consists of longtime Prime Minister Benjamin Netanyahu, his allied Defense Minister Yoav Gallant, centrist opposition leader Benny Gantz, and three observers. As the war approaches its 250th day, Netanyahu’s coalition shows signs of dissolving as the right wing attempts to block a potential hostage deal with Hamas, and as Gantz pushes for a post-war plan.
The impact
Since Gantz’s opposition coalition broke apart in March, his National Unity party lacks the votes to bring down Netanyahu’s government by themselves. Nevertheless, Gantz has put forward a bill to dissolve the Knesset with the hope that they can convince the country’s far-right to join them. It is possible that losing Gantz’s support does not bring down the war cabinet, and instead just shifts the government further right, likely meaning a more aggressive war effort. If Gantz and the far-right are capable of bringing down the government, most election polling shows him neck and neck with Netanyahu.
June 9 – Bulgarian election
Bulgarians will go to polls Sunday to renew the country’s parliament after President Rumen Radev announced snap elections in April.
What’s happened so far
The vote will take place coinciding with the European Parliament elections and in the context of years-long political instability in the country. Bulgaria has held six general elections since 2021, with successive caretaker governments appointed by President Radev amid impasses to achieve an efficient governing coalition. The upcoming vote is the outcome of a blockade in negotiations between ruling coalition GERB and PP parties over power rotation in March.
The impact
Bulgaria is the poorest country in the EU and one with high corruption indexes. Its population of 6.5 million is highly polarized and a fragmented result in the general election is expected on Sunday, along with low voter turnout. The Ruling GERB party leads polls followed by the Revival nationalist pro-Russian party. Another unstable coalition could further risk the country’s chances to gain full Shengen rights and enter the eurozone.
June 11 – Syrian Kurdistan election
An autonomous government led by Syria’s Kurds is planning to hold municipal elections in northern and eastern parts of the country under its control Tuesday, a move criticized by one of their biggest allies, the United States, and facing the threat of military action from Turkey.
What’s happened so far
Syria’s Kurds have been governing themselves for the most part since the start of the country’s civil war in 2011, when influence of the Damascus-based government was reduced to protecting the Al-Assad family’s hold on power. The ethnic group has since allied itself with the United States to limit the spread of the Islamic State, but has come under fire from neighboring Turkey, which considers it a threat to its national security. Unlike Kurds across the border in northern Iraq, Syria’s Kurds don’t enjoy central government support. In addition to attacks by Turkey’s military, the population of about 2 million people suffers from lack of services intensified by infrastructure damage resulting from strong earthquakes in southern Turkey in early 2023.
The impact
Turkey views the planned Kurdish vote across its border as an attempt to strengthen Kurdish separatists inside its own territory, which it has fought since the 1980s. The United States has called on Kurdish authorities to postpone the vote, claiming that conditions for “free, fair, transparent and inclusive” polls haven’t been met. The possible escalation of military conflict in northern Syria would add a new layer to an already inflamed situation in the region, as U.S.-backed Israel continues to fight in Gaza and southern Lebanon, while occasionally bombing targets belonging to Syria’s Iran-backed government.
June 12 – Pakistan federal budget
Pakistan is expected to present its annual budget Wednesday, unveiling details of economic planning seen as crucial to unlocking a new IMF loan.
What’s happened so far
The original date of the announcement was pushed to Wednesday due to Prime Minister Shehbaz Sharif’s four-day visit to China which rendered him unable to lead key consultations or hold the critical National Economic Council meeting. The budget will total around an anticipated 18 trillion PKR (more than $64 billion) and is expected to increase the general sales tax on food, beverages, medicine, petroleum products and some luxury items.
The impact
The budget comes at a pivotal time for Pakistan, which has struggled economically over the past few years, facing high inflation and political uncertainty. The country, however, predicts a GDP growth of up to 3.6 percent next fiscal year, with the planning ministry saying inflation is likely to fall as low as 12 percent over the next few weeks.
June 13 – Italy hosts G7 summit
Italy is set to host the 50th G7 summit starting Thursday in the country’s Puglia region.
What’s happened so far
Italy holds the rotating presidency for the G7 in 2024, and the summit will bring together heads of state from the U.S., Canada, U.K., France, Germany and Japan. In addition to leaders from the Group of 7 countries and the European Union, other world officials have announced their intention to join the informal forum, including Turkey’s President Tayyip Erdogan, while reports suggest controversial officials like Saudi Arabia’s Crown Prince Mohammed bin Salman could also be in attendance.
The impact
Italy’s Prime Minister Giorgia Meloni said this year’s key agenda points will be on supporting African development as a means to tackle rising migration levels into Europe as well as the dangers of artificial intelligence, with Pope Francis set to be a key speaker in the latter topic. The wars in Ukraine and Gaza are both set to be top priorities, with G7 leaders this week publishing a joint statement “fully endorsing” the ceasefire proposal put forward by U.S. President Joe Biden in Gaza.
June 14 – Ecuador’s Daniel Noboa set to visit Spain
On Friday, Ecuadorian President Daniel Noboa will visit Madrid to meet with Ecuadorian migrants living in Spain.
What’s happened so far
The initial meeting was supposed to happen in late May, but was called off due to the ongoing political spat between the Mexican and Ecuadorian embassies. While no official meetings between Spanish leaders and Noboa have been planned, Ecuador’s ambassador to Spain said there was a possibility of a meeting with Prime Minister Pedro Sánchez, before both travel to Switzerland for the Ukraine peace summit.
The impact
More than 400,000 Ecuadorians live across Spain, with around a quarter of them in Madrid alone. In an earlier official meeting between the two countries, both vowed to continue strengthening partnerships in order to protect the Ecuadorian community in Spanish cities.
What Else Matters
South Korea suspends military deals with North Korea over trash balloons
In an unusual turn of events for inter-Korean relations, North Korea sent hundreds, possibly thousands, of balloons carrying bags of trash over the border into South Korea in the past week. South Korea found manure, cigarette butts and waste paper but no dangerous substances in the balloons. North Korea said this was in direct retaliation to South Korean leaflet campaigns, where activists send their own balloons carrying anti-Pyongyang propaganda and USB drives loaded with popular South Korean music and TV shows into North Korea. In response, South Korea moved to fully suspend a 2018 military deal with North Korea originally intended to ease front-line tensions.
Watch for: North Korea has suspended balloon launches for the time being, but threatened to resume if leaflets are sent over from South Korea again, which activists seem intent on continuing. The suspension of the 2018 agreements mean South Korea can resume military activity along the Demilitarized Zone and in the Yellow Sea, as well as loudspeaker broadcasts near the border. Tensions are likely to continue to increase as both North and South Korea will use their counterparts’ respective actions as justification for further escalation.
West gives Ukraine permission to use weapons on Russia
The United States has granted Ukraine permission to use their weapons to strike targets on Russian territory. Previously, their use had been restricted due to concerns it would significantly escalate the war, but Russia’s latest counteroffensive on Ukraine’s Kharkiv region in early May prompted western allies to change their approach. U.S. media reported that the Biden administration had given the go-ahead for Ukraine to use American weapons to strike within Russia for the limited purpose of defending Kharkiv. Russia’s Deputy Foreign Minister Sergei Ryabkov warned of “fatal consequences” for the use of western weapons on Russia, stating America clearly underestimates the seriousness of possible retaliation.
Watch for: In the short term, the approval is unlikely to lead to any substantive changes on the battlefield. Russian forces continue to engage Ukraine on the ground around Vovchansk and Lyptsi in Kharkiv Oblast, although their progress has slowed. Russia has intensified strikes on Kharkiv city in recent weeks, causing heavy damage and civilian deaths. The United States excluded the use of long-range weapons such as ATACMS missiles in its permission to strike Russian targets and this will likely mean Ukraine will be limited to areas bordering Kharkiv. That said, the use of western weapons will likely significantly strengthen Ukraine’s ability to target Russian logistics centers and bases in the Belgorod Oblast.
Extended Outlook
What’s on our radar in the coming weeks…
June 8-14
June 8
- Israel’s Gantz deadline for possible resignation
- Macron, Biden meet
June 9
- Bulgaria election
- Argentinian air traffic controllers strike
- Spain-Morocco business summit
June 10
- Iraq’s Kurdistan region holds parliamentary elections
June 12
- Pakistan federal budget
June 13
- G7 summit in Germany
- Astana International Forum in Kazakhstan
June 14
- Euro 2024 in Germany
- Tesla job cuts start
- Ecuador’s Naboa visits Madrid
June 15-21
June 15
- Ukraine draft peace proposal summit in Switzerland
- China coast guard rules go into effect
June 18
- Thailand’s former PM faces charges over monarchy insults
- Boeing CEO testifies before US Senate panel
June 20
- Coronation of 17th King of Malaysia
June 20
- Hearing to dismiss Trump’s classified documents trial
June 22-28
June 22
- Chad presidential elections second round
June 26
- Possible last day of water from Mexico City’s Cutzamala system
- RIMPAC exercise around Hawaiian Islands
- BBC Rishi Sunak and Keir Starmer debate
- NBA draft
June 27
- CNN Biden-Trump electoral debate
June 28
- Iran presidential election
June 29-July 5
June 29
- Mauritania elections
June 30
- Deadline for Pakistan to pass necessary legislation to receive IMF loan’
- EU to end military mission to Niger
- NYC Pride march
- WSJ reporter pre-trial detention in Moscow expires
July 1
- China to restrict exports on aviation, aerospace equipment
- Uber, Lyft services set to leave Minneapolis
July 2
- Russian detention of US soldier expires
July 4
- UK general election
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Top photo: President Emmanuel Macron will host U.S. President Joe Biden on June 8. The two last met in Washington, D.C., in December 2022. (Official White House Photo / Cameron Smith)
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