Risk of global catastrophe grows, experts say – 01/10/2024 – Market

The perception of global risks for the next ten years has deteriorated significantly over the past few months, and climate and environmental crises top the list of problems, shows a report on the topic.

According to the 19th edition of the Global Risks Report, produced by the World Economic Forum with the Zurich insurance group and the Marsh McLennan consultancy, 63% of experts predict a “stormy” (with “catastrophic risks lurking”) or “turbulent” ( “upheavals and heightened risk of global catastrophes”). Last year, these were the expectations of 54% of respondents.

On the other hand, the perception of risks in the short term (two years) improved after three years of pandemic, more than two years of wars and various commercial and economic skirmishes. 30% classify the short-term scenario as stormy or turbulent, compared to 82% who did so last year, at the height of the Ukrainian War and tensions between the USA and China.

During September, 1,400 risk analysts, political leaders and industrial leaders were interviewed for the survey, launched on the eve of the forum’s annual meeting, which takes place next week in Davos, Switzerland. For 54% of them, the scenario is one of insecurity (“instability and moderate risk”) in the next two years, a contingent that drops to 29% when the question refers to ten years.

Only 15% expect stability (“isolated disturbances and low risk of catastrophe”) in the two-year period, and 8% in the decade. Those who envisage a “calm” horizon (“insignificant risk”) are just 1% for both periods. Last year, 9% predicted calm in ten years, and 11%, stability.

Extreme weather events (droughts, floods, storms, hurricanes, melting ice, blizzards, etc.) are the main immediate concern and also the most serious risk in the ten-year scenario, the report shows.

This Tuesday (9), the European Union’s Copernicus Climate Change Service officially declared 2023 the hottest year in history, and measured an increase of 1.48°C in global temperature in 250 years, at the limit of what scientists and diplomats set the maximum level for dealing with the crisis — which illustrates the difficulty of containing it.

The four most cited risks for the decade are related to climate and the environment, such as the scarcity of natural resources and the loss of biodiversity.

In an indication of the fears that are growing with this year’s American election campaign, given the history of recent cycles combined with the popularization of artificial intelligence tools, misinformation was the most cited problem in the short term, followed by extreme weather events.

This item appears only in fifth place in the ten-year scenario, but is immediately followed by the adverse effects of AI, which is not on the most imminent list.

“Geoeconomic confrontation” — a way of describing friction between the US and China — is not even on this year’s lists, perhaps a sign that they have been naturalized or that pragmatism actually prevails. In the previous report, they were the third biggest problem in the short term and ninth in the long term.

The report also draws attention to demographic changes, whether in forced migration or changes in the population structure, with an increase in the proportion of elderly people. It is a problem that Brazil will face in the coming years with the end of the so-called “demographic bonus” (when the economically active population is large enough to absorb the costs of the inactive population).

Finally, concern arises about “geostrategic” changes, which is how the document describes the new political, commercial and financial relations between countries, in addition to the concentration and distribution of resources. The US/China friction, the alignments following the Ukrainian War and the new alliances derived from the advance of nationalism fuel this risk.

Such trends, the report warns, must be catalyzed by technology (notably AI) and, thus, encourage new security risks.