WEF Global Risks Report 2024

WEF Global Risks Report 2024

The World Economic Forum published its annual Global Risks Report in January.  This is based on its survey of the perceptions of around 1,500 experts across academia, business, government, the international community and civil society. The survey ran from 4 September to 9 October 2023.

It’s not a happy community. Most anticipate some instability and at least a moderate risk of global catastrophes in the next two years; 3% expect catastrophe within 2 years. Over the 10-year time horizon, the view is markedly more negative, with nearly two-thirds of respondents expecting a stormy or turbulent outlook.

Four “structural forces” driving global risks over the longer term are identified:

i. Climate change

The report anticipates the threshold of 1.5°C above pre-industrial temperatures being crossed by the early to mid-2030s. The degradation of environmental systems could also accelerate estimated trajectories.

In fact, the WEF’s top 4 global risks over ten years are all climate change related: extreme weather events; critical changes in Earth systems; biodiversity loss and ecosystem collapse; natural resource shortages. Pollution is also in the top 10.

ii. Demographic bifurcation

Most countries will continue to grapple with an ageing population, combining a long term rise in life expectancy with declining fertility rates. In contrast, Africa faces a different policy challenge: by 2030, young Africans are expected to constitute 42% of global youth.

iii. Technological acceleration

Key technologies expected to develop rapidly over ten years include general-purpose AI, quantum computing, and brain-computer interfaces bringing risks and benefits with unknown effects.

Top risks identified include misinformation and disinformation, adverse outcomes of AI technologies and cyber insecurity.

iv. Geostrategic shifts

Changing patterns of geopolitical power and related alliances and dynamics over the next decade throw up a range of possibilities. Economic power is becoming more diffuse; an array of powers will likely assert their dominance on the global stage in a multipolar world.

WEF recognised that risks in one area often have implications for others, producing a comprehensive relationship map.

They also discuss a number of major “global shocks” – or “wild cards”:

  • Three climate-related ones include: collapse of the Atlantic Meridional Overturning Circulation disrupting the Gulf Stream and shifting rain patterns in Africa; melting permafrost releasing an ancient pandemic; ungoverned or competitive climate manipulation from geo-engineering disrupting rainfall.
  • Technological shocks include a breakthrough in cryptographically-significant quantum computing capability destabilising global security dynamics; technological power in the hands of unelected people interfering with inter-state relationships (e.g. the use of civilian satellites in the war in Ukraine); and novel bioweapons becoming more easily and cheaply available.
  • A couple of socio-political issues are also included: the UN’s Sustainable Development Goals are eroding – distribution of aid is becoming driven by narrow security interests rather than broader, traditional development imperatives. Deepening frustration with economic conditions will drive societal divisions as individuals demand better opportunities, income equality and improved living standards. Workers threatened by these two transitions will fuel the anti-tech and anti sustainability backlash. 

Responding to global risks

The report’s final section considers how global risks can be addressed against a backdrop of a fragmented geopolitical environment where cooperation may be in short supply. Four broad categories of approaching global risk reduction are assessed based on the level of cooperation required:

  • localised strategies: although clearly limited in impact, actions such as public awareness campaigns can limit the spread of pandemics, insurance can help recovery from extreme weather events, and national regulations can manage economic shocks, pollution and public health.
  • breakthrough endeavours: research and development defending against risks can be copied or deployed globally for wider communal benefit. Areas suited to this are climate change (both mitigation and adaptation), technological risks and healthcare.
  • collective actions: the aggregate and independent effort of single citizens, companies and countries can result in tipping points. Changes in lifestyle or consumption patterns that are insignificant when pursued by an individual can become a trend so that, in aggregate, they alter market dynamics. Examples include expanding the adoption of a vegetarian diet or reducing combustion-engine cars and air travel to slash carbon emissions.
  • cross-border coordination: although clearly constrained in an increasingly fragmented world, coordination remains imperative to solve the biggest existential risks. It is most possible where self-interests align, arguably as in climate change mitigation or ozone depletion.

The report concludes that, ultimately, as the world is undergoing multiple long-term structural transformations, a combination of strategies is needed to address the emerging risks. It may be unfair to regard this as rather an anodyne conclusion after all that work. However, we should recognise that it is easier to identify risks than find solutions and that by providing a pretty comprehensive review of the risks, the WEF Global Risks Report does help start conversations on the best ways forward.

Written by Huw Williams, SAMI Principal

The views expressed are those of the author(s) and not necessarily of SAMI Consulting.

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