Five Global Issues That Will Shape the Future
Covid-19 has not only changed our habits and routines, but also revealed how our lives can be turned upside down if we do not take action against the global threats that we often choose to ignore in our daily rush. As such, the global shock has made us all think more about what kind of future awaits the world, and many international organizations have started to work on measures that can be taken by shifting their focus to global threats. As a result of the research conducted by the International Red Cross within the scope of “Strategy 2030”, the global threats that need urgent action are divided into five groups as “climate change”, “global crisis and disasters”, “migration and identity”, “health” and “values, power and inclusion”. is listing. Similarly, Kaysie Brown, United Nations Vice President for Political and Strategic Initiatives, draws attention to climate change, ensuring sustainability, increasing inequality and exclusion, conflicts and global unity in her article titled “Five Global Issues to Consider in 2020”. The World Economic Forum underlines the need to pay attention to food security, climate change, inclusive growth, financial crises, internet use, inequality, international trade, long-term investments and health. The most impressive compilation of all the threats mentioned is the report titled “Five Emerging Global Problems and Implications” published by PwC last May. This report begins by emphasizing the need to focus on today’s megatrends and their secondary impacts in order to identify the global challenges that will determine the world’s future. Then, within the framework they call ADAPT, it collects the problems that will determine the future of the world, the society, business world and individuals face under five main headings: asymmetry, deterioration, old age, polarization and trust, and presents its conclusions regarding each topic.
Asymmetry: Inequality of Income and Opportunity
Global income inequality has shot up all over the world over the years. In fact, according to Credit Suisse’s Global Wealth Databook, half of the global wealth is in the hands of only 1% of the population. Although inequality has increased all over the world, it is possible to say that the rate of increase differs between regions. According to the World Inequality Report published by World Inequality Lab in 2018, the share of the highest earning 10% of the country’s total national income alone is 37 percent in Europe, 41 percent in China, 46 percent in Russia, Canada and the USA. 47 percent in ; It is around 55 percent in Sub-Saharan Africa, Brazil and India, and around 61 percent in the Middle East. In addition, as technology begins to replace the individual workforce, existing jobs are decreasing, while investment in innovative areas that can create new business lines remains at very low levels, causing the middle class in both developed and developing countries to shrink. Research suggests that rising income inequality can cause problems ranging from low consumption to social and political unrest and undermine future global economic prosperity.
Expectations
If global income inequality cannot be prevented, inequality of opportunity will increase, inequality of opportunity between geographical regions will face the threat of further increase, the importance of capital markets will decrease, and consumption will be reduced to two groups as luxury and lower class with the shrinkage of the middle class.
Distortion: Man’s Relationship with Technology and Nature
Important technological developments such as artificial intelligence, internet of things, automation and blockchain have taken place in our daily lives much faster than anticipated. Rapidly developing and diversifying technological breakthroughs have not only revealed new business models, but also blurred traditional boundaries with their inter-industry applicability. As the market dynamics and business models develop an adaptive structure parallel to technology, it is expected that capital will replace the workforce and a significant increase in unemployment rates. Moreover, the structural change and deterioration that will shape the future is not only observed in the relationship between human and technology. The consequences of the change in the relationship between man and nature pose serious problems for water and food security. At this point, it is worth remembering that the world population is expected to reach 9 billion in 2050, and in parallel, the demand for food will be 60 percent higher than it is today. In parallel with global warming and climate change, taking necessary measures by institutions and governments is at least as important as adapting to technological developments.
Expectations
Digital transformation and the speed of keeping up with change will play a critical role in the survival of companies. While the tendency of enterprises to localize increases, the factor that differentiates enterprises from their competitors will be their technology capital. In addition, agricultural land lost as a result of rising sea levels and climatic changes will increase the importance of food supply and security in food supply chains. The transition to renewable energy will take longer than planned and will require greater investment than anticipated. Health systems will constantly be at war with the increasing risk of global pandemics.
Age: Increasing Average Age of the Global Population
The World Population Prospects report published by the United Nations in 2019 contains striking predictions. It is expected that the child population, which was 13 percent in 1950, will decrease to 7 percent in 2050, and the elderly population, which is 5 percent, will increase to 16 percent. In other words, the average age of the global population is increasing. This is a harbinger that economies with young populations and countries with a relatively high average age will face different problems. While countries with young populations are struggling with the increase in the unemployment rate of the young population, older workers will have to work longer in countries with older populations, and governments will have to support their workforce with immigrant and female workforce. In short, while the aging of the population will seriously affect the labor, real estate and financial markets, it will also create a serious change in the demands for goods, services, transportation and social security compared to today.
Expectations
With the increasing average age, needs and consumption habits will change. In order to prevent unemployment in countries with young populations, new jobs will need to be created. The retirement age will rise in countries with older populations, and as the tax base erodes globally, there will be increasing pressure on governments to manage welfare programs.
Polarization: The Collapse of Global Consensus
With economic growth becoming independent of social progress, globalization, automation and economic changes have led to an increase in populism. Parallel to this, a new understanding of nationalism, in which countries prioritize their own interests, began to rise. As a manifestation of this, countries entered into competition for reductions in corporate tax in order to give companies a little bit of relief, and protectionist tariffs began to be imposed in bilateral trade agreements. Tensions began to increase in international commercial and bureaucratic relations as local concerns in countries took precedence over global concerns. In fact, one of the five items mentioned in the article titled “Five Global Issues to Consider in 2020” published on the United Nations website points to the importance of taking action together and evaluating the opportunities that can make the world sustainable, equitable and fair.
Expectations
It will become more difficult for international organizations to reach consensus, local concerns of society will take precedence over global concerns, countries will compete for capital and talent, and international conflict and insecurity will increase.
Trust: Decreasing Trust in Institutions
The global faltering of trust in institutions began many years ago as they gradually moved away from the societies they represented, and gained momentum with the financial crises. Although it was expected that technological developments, which entered our lives quickly, would increase transparency in institutions and prevent this erosion of trust, negative experiences revealed a picture contrary to expectations. Data security breaches, social media manipulations and fake news have reinforced the atmosphere of insecurity by causing more questioning of institutions. So much so that, according to the 2020 Edelmen Confidence Barometer, 66 percent of the world’s population does not feel safe.
Expectations
Individuals’ concerns about personal and digital security will increase with the advancement of technology, and increasing skepticism will make it harder to create change. Facilitating social media manipulations and skepticism towards the truth will increase the opportunity for misinformation. Governments will need to introduce stricter regulations to keep data safe.
These topics, which are underlined by many international organizations and compiled by PwC in the framework called ADAPT, both shed light on the global problems that will determine the future of the world and offer very important clues about the measures to be taken. Intensifying efforts to prevent inequality of opportunity and income, reviewing the relationship of human with technology and nature, taking into account the changing demographic structure in the decisions taken and future projections, understanding the importance of consensus in the solution of global problems and increasing the trust in institutions. seem to be important steps to be taken in order to bring
