Global Risks Report 2021 - Economic fragility is set to increase; environmental risks remain a strong reason for concern

21 January 2021 — XPRIMM
"Despite the inescapable fallout from COVID-19, it is climate-related matters that make up the bulk of this year's risk list, which the report describes as "an existential threat to humanity," the latest Global Risks Report 2021, launched on January 19, shows.

The report is part of World Economic Forum's Global Risks Initiative and it analyze the risks and consequences of widening inequalities and societal fragmentation.

According to the Report's findings, among the highest likelihood risks of the next ten years are extreme weather, climate action failure and human-led environmental damage, as well as digital power concentration, digital inequality and cybersecurity failure.

Borge Brende, the President of World Economic Forum opens the Conference by saying that:" The global health system is under huge pressure and we also know that the world needs to really wake up to ongoing global risks. Covid-19 is one of the deadliest viruses in the history and it shows that we should pay much more attention to risks. The global economy is at its deepest peacetime slump even if we not see an early recovery. World output is expected to shrunk by 4.4% last year and the recession unfortunately will lead to a situation where almost 150 million people will end up in an extreme poverty. This in one of the main findings of this report and one of our main worries for the coming years."

Carolina Klint, Risk Management Leader, Continental Europe, Marsh declared:" We all had the opportunity to learn that low frequency, high severity events do happen and also that their impact can be sudden. It is clear that in pure collaboration and coordination is the only way to improve our collective resilience and capacity to respond to these shocks. We see many businesses now grappling to survive and build resilience and not only in relation to ongoing pandemic impacts but they also have to cope with an increase number of cyber-attacks, catastrophic climate events and social unrest. There are three critical drivers for this changing risk landscape: political, technological and societal."

Regarding the digital changes of the companies and how they respond to that, Peter Giger, Group Chief Risk Officer, Zurich Insurance Group said: "Covid-19 has accelerated the industrial revolution with the rapid expansion of e-commerce, online education, digital health and also remote work. And these shifts will continue to transform human interactions in life long after Covid is behind us. Automation was reshaping labor markets and it may replace as much as 85 million jobs in the next 5 years and the digital may create a hundred million jobs, education and lifelong learning can increase digital literacy and play a critical role in closing digital devices." He also added that: "In developed and emerging economies a rapid way to remote working is expected to create long term productivity, but it risks creating future gaps between the homeworkers and those who cannot work remotely."

Guillaume Barthe-Dejean, Director, Chairman's Office, SK Holdings said: "There are 2 key challenges that stand outs. The first is how we how address the economic costs from the pandemic and we sheal that from future shocks. The good news is some countries managed to belong the economic damaged to some extends. In Asia: China, Japan and Correa GDPs are better performed than in Indonesia and The Philippines. The bad news is that global dead level is rising fast and we will maybe waking into the next souverain crisis. There are countries where the GDP ratio is set to rise from 60 to 70% in the medium term. The second challenge is social cohesion and its impact on the effectiveness of public policy. The deterioration in public health and measures imposed by governments have really tested social resilience to breaking points."

The foundation of the report continues to be the annual Global Risks Perception Survey, completed by over 650 members of the World Economic Forum's diverse leadership communities.

The report is produced in collaboration with Zurich Insurance, Marsh McLennan and SK Holdings and can be downloaded here.

Share |