A Short Note on Global Risk Report 2013 by World Economic Forum

The Global Risk Report 2013, released by the World Economic Forum is a detailed study on the risk which will affect the world in the near future. This Blog keeps the vision to promote awareness about that crucial report. In the introduction Mr Klaus Schwab Founder and Executive Chairman of World Economic Forum has invited our attention towards these risks and requested to debate on these threats

This year’s meeting of the World Economic Forum was held at Davos, Switzerland on the theme Resilient Dynamism. This particular theme was raised to bring and spread awareness about the risks which will affect the whole world without the country barrier. These risks are divided into three categories such as 1) preventable risks 2) strategic risks 3) external risks or global risks. This report is based on this years’ Global Risk Perception Survey performed by more than 1000 experts from various sectors including industry, government, academics and civilians.

Economic Risks

Finance is very complex and economic risks will be higher in the future. The major economic risk will be Severe Income Disparity and the financial system failure arising  from that. Throughout the centuries the rich-poor indifference was the root cause of all rebellion.

Many philosophers envisaged the importance of equality and socialism but these ideologies never culminated as a permanent solution. The future will witness an increase in the financial gap between rich and further consequences.

Chronic Fiscal Imbalances will make the government  a failure in redressing the huge amount of debt. The government’s future development plans and related borrowing may not go hand in hand with the income generated in the respective countries. This report throws light on the volatility in energy and agricultural prices as another risk which is likely to happen. Hard Landing of an emerging economy has also been predicted. This happens due to the tightening of the monetary policy the central governments of those respective countries as happened in the US. Chronic labor market imbalances may be the other general risk comes in this category.

Environmental Risks

The second category of major risk is related to the environment. Increased Green House Gas Emissions. will be the major threat. The governments and industries will focus on to the expansion of carbon sinks to fight these greenhouse gases. All over the world climate is changing rapidly and this will be another risk and adapting to the changes will not be an easy task that may even fail. The Failure in Climate Change adaptation will be a great risk. Mismanaged Urbanization also comes as one of the environmental issues. The number of urban population in search of a better asylum is exceeding than rural due to the rural exodus  less people are remaining to work in the agriculture  segment which should be the base industry of any economy!

A collapse in the ecosystem is well predicted due to the Over Exploitation of the Species

This species overexploitation will lead to the destruction of the biodiversity. Another risk forecasted is the Persistent Extreme Weather. Land and Waterway use Mismanagement is another risk in the environment category, Misuse of the waterway and land will have severe consequences which will adversely affect the ecosystem leading to a collapse.

Geopolitical Risks

The report calls it Pervasive Entrenched Corruption; the major threat among the geopolitical risks. Corruption, which is a worldwide phenomenon, will increase day by day, the abuse of power will be extended for the personal gain and the rulers will be biased for the lobbies. Global Governance Failure which will be the result of the weak governing institutions, the treaties will fail to get accomplished; world governance together will fail to address the global issues or risks and the governments will hesitate to collaborate. Third risk will be Terrorism which is already deep-rooted in many countries will cause severe human and material damage and in the coming days society will be more capitulated towards terrorism. The number of international conflicts will increase due to the Failure in the Diplomatic Conflict Resolution. This risk will lead the world to be a battlefront and a difficult place to live. Entrenched Organized Crime will be a great risk and this will be organized by agile global networks. Illicit Trade is another risk this will include people as well as goods.

Societal Risks

There are 4 major risks which are likely to happen in the next ten years. Water Supply Crises will lead to the shortage of fresh water. Population ageing due to the rising life expectancy or declining birth rates and its Population Ageing Mismanagement will be the

other risk in societal category. The next risk is Rising Religious fanaticism which will divide the society to different poles causing tensions. The Food Shortage Crisis will be another major risk.

Technological Risks

As China is known for its Cyber Attacks, the state owned organized Cyber attacks will be the greatest risk which is likely to take place in the next ten years. These attacks will be with terrorist or criminal backing. Private lives are under scrutiny and the Massive Data Theft will be another major risk.. This data extraction will deleterious for the personal and official security of the people as well as nations.

The Global Risk Report 2013 is a result of detail study and it clearly indicates us  to abate the risk even though it is not a clairvoyant report. This blog is based on the risks which are more likely to happen. It teaches us how important is for us to abstain from hurting the world we live.