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World Economic Forum Report Lists Out Threats to Global Economy

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Cybersecurity and area are rising dangers to the worldwide financial system, including to present challenges posed by local weather change and the coronavirus pandemic, the World Economic Forum mentioned in a report Tuesday.

The Global Risks Report is often launched forward of the annual elite winter gathering of CEOs and world leaders within the Swiss ski resort of Davos, however the occasion has been postponed for a second 12 months in a row due to COVID-19. The World Economic Forum nonetheless plans some digital periods subsequent week.

Here’s a rundown of the report, which relies on a survey of about 1,000 consultants and leaders:

World outlook

As 2022 begins, the pandemic and its financial and societal impression nonetheless pose a “critical threat” to the world, the report mentioned. Big variations between wealthy and poor nations’ entry to vaccines imply their economies are recovering at uneven charges, which might widen social divisions and heighten geopolitical tensions.

By 2024, the worldwide financial system is forecast to be 2.three p.c smaller than it will have been with out the pandemic. But that masks the totally different charges of development between creating nations, whose economies are forecast to be 5.5 p.c smaller than earlier than the pandemic, and wealthy international locations, that are anticipated to develop 0.9 p.c.

Digital risks

The pandemic compelled an enormous shift — requiring many individuals to work or attend class from residence and giving rise to an exploding variety of on-line platforms and gadgets to assist a metamorphosis that has dramatically elevated safety dangers, the report mentioned.

“We’re at the point now where cyberthreats are growing faster than our ability to effectively prevent and manage them,” said Carolina Klint, a risk management leader at Marsh, whose parent company Marsh McLennan co-authored the report with Zurich Insurance Group and SK Group.

Cyberattacks are becoming more aggressive and widespread, as criminals use tougher tactics to go after more vulnerable targets, the report said. Malware and ransomware attacks have boomed, while the rise of cryptocurrencies makes it easy for online criminals to hide payments they have collected.

While those responding to the survey cited cybersecurity threats as a short- and medium-term risk, Klint said the report’s authors were concerned that the issue wasn’t ranked higher, suggesting it’s a “blind spot” for firms and governments.

Space race

Space is the ultimate frontier — for danger.

Falling prices for launch know-how has led to a brand new area race between firms and governments. Last 12 months, Amazon founder Jeff Bezos’ area tourism enterprise Blue Origin and Virgin Galactic’s Richard Branson took off, whereas Elon Musk’s Space X business made big gains in launching astronauts and satellites.

Meanwhile, a host of countries are beefing up their space programmes as they chase geopolitical and military power or scientific and commercial gains, the report said.

But all these programmes raise the risk of frictions in orbit.

“Increased exploitation of these orbits carries the risk of congestion, an increase in debris and the possibility of collisions in a realm with few governance structures to mitigate new threats,” the report mentioned.

Space exploitation is likely one of the areas that respondents thought had among the many least quantity of worldwide collaboration to cope with the challenges.

Experts and leaders responding to the survey “do not imagine that a lot is being accomplished in the absolute best method transferring ahead,” World Economic Forum’s managing director, Saadia Zahidi, said at a virtual press briefing from Geneva.

Other areas include artificial intelligence, cyberattacks and migration and refugees, she said.

Climate crisis

The environment remains the biggest long-term worry.

The planet’s health over the next decade is the dominant concern, according to survey respondents, who cited failure to act on climate change, extreme weather, and loss of biodiversity as the top three risks.

The report noted that different countries are taking different approaches, with some moving faster to adopt a zero-carbon model than others. Both approaches come with downsides. While moving slowly could radicalise more people who think the government isn’t acting urgently, a faster shift away from carbon intense industries could spark economic turmoil and throw millions out of work.

“Adopting hasty environmental policies could also have unintended consequences for nature,” the report added. “There are nonetheless many unknown dangers from deploying untested biotechnical and geoengineering applied sciences.”


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