It’s that time of year when various luminaries gather in Davos to sort out the world. They do so as President Trump takes office and starts to disrupt the previous world order. There are strong arguments that the “Washington consensus” and the global “rules-based order” are gone forever and maybe represented a blip rather than fundamental shift – see George Monbiot for example.
Nonetheless, the WEF have produced their usual annual Global Risk Report. In our review of last year’s report, we noted that Global Risks Perception Survey respondents’ view of the 10-year horizon were markedly negative. Outcomes were expected to be driven by four “structural forces” – climate change, ageing populations everywhere except sub-Saharan Africa, technological acceleration and geostrategic shifts.
This year, the 10-year view is dominated by environmental risks. Extreme weather events, biodiversity loss and ecosystem collapse, critical change to Earth systems and natural resources shortages lead the 10-year risk rankings. A fifth environmental risk in the top 10 is pollution, which is also perceived as a leading risk in the short term.
Key findings from the survey are:
Declining optimism: current turbulence is expected to get worse. Over the 10-year timeframe, 62% of respondents expect stormy or turbulent times. There is a scepticism that current societal mechanisms and governing institutions are capable of navigating and mending the fragility generated by the risks we face today.
Deepening geopolitical and geoeconomic tensions: state-based armed conflict tops the current risk landscape
A growing sense of societal fragmentation: Inequality and Societal polarisation and their consequences continue to feature among the top 10 risks.
Looking to the 10-year horizon, the Report lists the same four structural forces as last year.
In particular, the Report is concerned about:
Pollution
By 2035, the compounded effects of pollution threaten to erode ecosystem resilience, diminishing its ability to sustain life and deliver essential services. Decline in health and well-being is increasingly associated with pollutant exposure, including the rising incidences of cardiovascular diseases, respiratory conditions, infertility rates and cancer.
Air, water and soil pollution is seen as a particular concern in Central and South-East Asia, Bangladesh and India. Air pollutants such as particulate matter (PM), ozone, nitrogen dioxide, sulphur dioxide and carbon monoxide cause health risks in vulnerable populations. “Black carbon” (soot) is a major component of PM2.5 pollution causing chronic respiratory conditions, strokes, heart attacks and cancer, as well as early childhood development issues and long-term effects on cognition and health.
Toxic “forever chemicals” and micro-plastics in water and the soil are major threats to health. Pharmaceutical pollution and over-use of antibiotics are increasing the risk of anti-microbial resistance. Nitrogen pollution from over-use of fertilisers damages rivers and seas; poor waste management releases methane, while e-waste brings other health risks.
Losing control of biotech
Despite many areas of beneficial outcomes, biotech comes with risks. Three sets of risks were identified in the Report: rising accessibility of bioweapons; negative health impacts as the flipside of efforts to cure or prevent health issues; and the potential for ethical boundaries to be crossed.
On bioweapons the concerns were around the development of new toxic agents or increasing the threat of existing ones such as monkeypox, more speedily developed using AI; the development of bioweapons by non-state actors; and links with cyber warfare.
Human genome editing technology is too new to predict its long-term effects on both the individuals being treated and future generations. In some gene editing processes, an individual’s genome is subject to significant rearrangements, which have the potential to generate other health issues, such as cancer or even new genetic diseases that are not yet understood by scientists and doctors.
Ethical challenges exist around changing a child’s eye or skin colour, modifying its height or, potentially increasing intelligence. Such “services” would be expensive and so only available to the rich. Brain-computer implants run the risk of being hacked or externally controlled.
Super-ageing societies
“Super-aged” societies – those with over 20% of population over 65 – will have increased dependency ratios creating pressures on pensions and other health benefits. Fewer people will be contributing to employer and private pensions schemes relative to the number of people whose retirements need funding, and with the length of those retirements rising, there will be pressure on institutional pension funds.
Attempts to increase statutory retirement age in response will face resistance from voters, a rising proportion of whom are themselves close to retirement. Intergenerational tensions could become an ongoing feature of super ageing societies, with discontented younger working cohorts resenting being called upon to pay more towards funding retiree pensions.
Ageing societies also have increased demand for long-term care services. In the United States, demand for long-term care services and support workers alone is projected to grow by 44% from 2020-2035. Increasing care costs will lead to increasing inequality.
Wider consequences will be seen in lower global economic growth over the next decade in super ageing societies, many of which are among the world’s largest economies. Despite policy pushback on immigration in the short-medium term, in the longer term the need to fill labour shortages could be decisive in shaping policy.
Over several decades, eventually low-income, super-ageing societies of the future could face a perfect storm – all the social and economic problems associated with today’s super-ageing societies but without fully developed social safety nets in place, and without the pools of private savings accumulated by some in today’s super ageing societies.
How does the global community cope?
Throughout the Report, there are recommendations for action today. But, despite having identified global geo-political tensions as a major trend, the Report ends with a “sweetness and light” conclusion about the need for effective global cooperation, that turning inward is not a viable solution. “Nations should prioritise dialogue, strengthen international ties and foster conditions for renewed collaboration.” Good luck with that.
Written by Huw Williams, SAMI Principal
The views expressed are those of the author(s) and not necessarily of SAMI Consulting.
Achieve more by understanding what the future may bring. We bring skills developed over thirty years of international and national projects to create actionable, transformative strategy. Futures, foresight and scenario planning to make robust decisions in uncertain times. Find out more at www.samiconsulting.co.uk
Commenti