Yet the same dynamic that lies behind these gains – everything being more connected and interdependent – also threatens to undermine them. Economic growth, for example, may be inexorably undermining its own foundations through its negative side-effects on ecosystems, biodiversity and the climate – effects that cannot be stopped at national borders. Disruptions in the online environment are becoming as impactful as those in the physical world, if not more.
Since 2006, the Global Risks report has been calling attention to global risks that can be systemic in nature, causing breakdowns of entire systems and not only their component parts.
These risks can come from many sources. The greater the interdependencies between countries and industries, the greater the potential for events to bring about unforeseen, cascading consequences. The year 2013 alone witnessed a number of illustrations of such risks, bringing significant losses in terms of both human life and wealth. The fiscal crisis in the United States (US), the subsiding threat of sovereign default in eurozone countries and popular protests in emerging markets all presented economic risks far beyond national borders. Typhoon Haiyan took a heavy toll on the Philippines, even as global leaders debated climate change in Warsaw in November 2013. Syria’s refugee crisis destabilized the entire Middle East. Revelations about data leakage and new forms of espionage created geopolitical tensions that may yet have far-reaching implications in the years to come. These events have painfully emphasized that the world is not equipped to deal with global risks.
This year, as in past editions, the Global Risks report represents a step in a continuous process of improving how global risks and their interconnections can be put on decision-makers’ radar screens, to provide a basis for dialogue on how governments, business and civil society can work together effectively to build resilience and mitigate any negative effects accruing from them.
Part 1 of the report presents the results of this year’s Global Risks Perceptions Survey, enumerating the 10 risks that respondents nominated as being of highest concern and also those they thought were most likely and potentially impactful. It also maps the strength of perceived interconnections among these risks to provide a holistic picture of the complexity and broad framework needed to understand their full potential impact. Finally, it includes a “risks and trends to watch” section, noting additional issues that respondents and experts were concerned about.
Part 2 selects and explores in detail three constellations of global risks from the Risks Interconnections Map. “Instabilities in an Increasingly Multipolar World” examines possible interconnections among risks related to the changing geopolitical order. “Generation Lost?” looks at how high rates of youth unemployment risk stoking social unrest and squandering human and economic potential, and how the current situation will affect tomorrow’s youth. “Digital Disintegration” imagines how cyberspace could become severely affected through growing strength of attacks and dwindling trust, at a huge cost to economies and societies.
The report also features contributions from several of the Forum’s Global Agenda Councils, which bring together thought leaders from academia, business, government, international organizations and other civil society organizations to set the global agendas in their respective fields. The Councils’ contributions explore a selection of specific risks that rank highly on the Global Risks Perceptions Survey.
The multistakeholder collaboration required to address global risks should take place through effective mechanisms of global governance, as global risks can only be addressed at a global level. Addressing risks effectively takes not only a common understanding of the issues and a willingness to work together but also the building of mutual trust and nurturing of the capacity for long-term thinking – issues further explored in the concluding section of Part 2.
Part 3 analyses the main learnings from past Global Risks reports and looks ahead towards the 10th anniversary of the report in 2015.
To work together to prepare and mitigate risks and strengthen resilience, leaders in business, politics and civil society all need to first identify, understand and monitor the most important global risks. The Global Risks 2014 report aims to facilitate this process and provide a platform for dialogue.