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WEF: Five key global challenges for 2017

Source: Asia Insurance Review | Feb 2017

The recently issued World Economic Forum’s (WEF) Global Risks Report 2017 has identified five key global challenges for 2017. These are:-
  • fostering greater solidarity and long-term thinking in market capitalism, 
  • revitalising global economic growth,
  • recognising the importance of identity and inclusiveness in healthy political communities,
  • mitigating the risks and exploiting the opportunities of the Fourth Industrial Revolution, and
  • strengthening our systems of global cooperation.
   The first two are economic, in line with the fact that rising income and wealth disparity is rated by GRPS respondents as the most important trend in determining global developments over the next 10 years. 
   This points to the need for reviving economic growth, but the growing mood of anti-establishment populism suggests we may have passed the stage where this alone would remedy fractures in society: reforming market capitalism must also be added to the agenda.
Identity and community
The next challenge is facing up to the importance of identity and community. Rapid changes of attitudes in areas such as gender, sexual orientation, race, multiculturalism, environmental protection and international cooperation have led many voters – particularly the older and less-educated ones – to feel left behind in their own countries. The resulting cultural schisms are testing social and political cohesion and may amplify many other risks if not resolved.
   Although anti-establishment politics tends to blame globalisation for deteriorating domestic job prospects, evidence suggests that managing technological change is a more important challenge for labour markets. While innovation has historically created new jobs as well as destroyed old ones, this process may be slowing. Challenges to social cohesion and policy-makers’ legitimacy are coinciding with a highly disruptive phase of technological change.
Global cooperation
The fifth key challenge is to protect and strengthen our systems of global cooperation. Examples are mounting of states seeking to withdraw from various international cooperation mechanisms. A lasting shift in the global system from an outward-looking to a more inward-looking stance would be a highly disruptive development. In numerous areas – not least the ongoing crisis in Syria and the migration flows it has created – it is ever clearer how important global cooperation is on the interconnections that shape the risk landscape.
   Further challenges requiring global cooperation are found in the environmental category, which this year stands out in the GRPS. Over the course of the past decade, a cluster of environment-related risks – notably extreme weather events and failure of climate change mitigation and adaptation as well as water crises – has emerged as a consistently central feature of the GRPS risk landscape, strongly interconnected with many other risks, such as conflict and migration.
   The Global Risks Report 2017 was developed with the support of Marsh & McLennan Companies, Zurich Insurance Group and benefitted from the collaboration of these academic advisers: the Oxford Martin School (University of Oxford), the National University of Singapore, the Wharton Risk Management and Decision Processes Center (University of Pennsylvania), and the Advisory Board of the Global Risks Report 2017.
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