Home > Economy, Insights and Commentary, Politics, Trends > WEF: Nine Greatest Risks to Global Stability

WEF: Nine Greatest Risks to Global Stability

January 17, 2011

That Plan ‘B’ I have referred to is becoming increasingly more important day by day. Becoming self-sufficient, planting a food garden, setting up a rainwater recapture system, integrating some solar to your home electrical system… all will go far in hedging global problems impacting your personal well-being.

I have read several summary reports of the WEF 2011 Global Risks Edition. The 50-page analysis of 37 global risks precedes the World Economic Forum’s (WEF) annual meeting in two weeks’ time in the Swiss ski resort of Davos, which brings together high-level politicians, central bankers and business leaders.

HUFFINGTON POST reports:

#1. Countries going broke are the biggest risk to the world’s economy.

Economists fear the fallout from slow growth and economic crisis in developed countries and stronger faster growth in emerging markets could spark protectionism, cause currency wars, and flood developing countries with cash.

“Current fiscal policies are unsustainable in most industrialized economies. In the absence of far-reaching structural corrections, there will be a high risk of sovereign defaults,” Daniel Hofmann, chief economist at Zurich Financial Services, who contributed to the WEF report, told Reuters.

According to the 2011 Global Risks Report, the value of everything from financial assets to real estate could continue to fall, sparking the collapse of banking systems.

Weak states, organized crime and corruption bolster illegal trade, undermining the law, according to this year’s Global Risks Report.

Organized crime undermining the rule of law destabilizes weak states and economies, the World Economic Forum report says.

Weak states, low government wages and the growth in organized crime and illicit trade bolster corruption, and prevent government from addressing its causes according to the World Economic Forum.

According to the Global Risks Report, everything from growing populations and bad infrastructure to water pollution from fertilizer, sewage and oil spills threatens global water supplies.

Rocketing food prices, growing populations and bad food distribution could mean malnutrition for the populations affected, as well as social and political unrest, according to the World Economic Forum report.Rocketing food prices, growing populations and bad food distribution could mean malnutrition for the populations affected, as well as social and political unrest, according to the World Economic Forum report.

The Global Risks Report found rapidly growing countries with poor infrastructure, and tensions in oil-producing states could slow growth, and spark social unrest and conflict.

Reuters also reported:

Other threats in 2011 include tightening supplies of basic resources such as food, water and energy, which John Drzik, chief executive of management consultancy Oliver Wyman, said were aggravated by lack of investment in infrastructure because of chronic fiscal deficits.

Surging global food prices have already set warning lights flashing on inflation. Food prices hit a record high last month, according to the United Nations food agency, surpassing levels in 2008 that sparked riots in countries from Egypt to Haiti.

“We’re entering a new age of commodity price volatility,” Drzik said. “It is not just a near term issue.”

Advertisements
%d bloggers like this: