As the world enters the third year of the Covid-19 pandemic, a growing dependence on digital systems has heightened the risks posed by cybersecurity threats globally, while fracture of inter-state relations, widespread youth disillusionment and digital inequality are among top risks for the Indian economy, a new survey showed on Tuesday.
The Global Risks Report 2022, released by the World Economic Forum (WEF) ahead of its online Davos Agenda meeting next week, said climate-related risks dominate the list of biggest concerns by impact and likelihood, most notably in the long-term –- where five of the top 10 global risks are all climate or environment-related.
Now in its 17th edition, the report has urged world leaders to think outside the quarterly reporting cycle and create policies that manage risks and shape the agenda for the coming years. The top five risks identified in the report are climate crisis, growing social divides, heightened cyber risks and uneven global recovery, as the pandemic lingers on. A global survey of experts found that only one in six are optimistic and only one in ten believe the global recovery will accelerate.
The report warned that the risks of growing social cleavages will continue to be exacerbated by the pandemic and experts are cautioning that the global economic recovery will likely be uneven and potentially volatile over the coming years. The economic fallout of the pandemic and diverging recoveries also continue to threaten cooperation on other global challenges – at a time when climate and environmental risks loom large. Besides, the growing dependence on digital systems -– which has only intensified in the past two years -- has heightened the risks posed by digital or cybersecurity threats.
With regard to India, the report said fracture of interstate relations, debt crises in large economies, widespread youth disillusionment, failure of technology governance and digital inequality are the top five risks identified for the Indian economy by the WEF's Executive Opinion Survey (EOS). The top shorter-term global concerns include societal divides, livelihood crises and mental health deterioration, while most experts believe a global economic recovery will be volatile and uneven over the next three years, the WEF said. The report further said geopolitical tensions are spilling over into the economic sphere and cited examples of India and Japan putting protectionist policies in place during the pandemic.
On risks that have worsened the most since the start of the pandemic, it identified social cohesion erosion, livelihood crises, climate action failure, mental health deterioration, and extreme weather as the top five. Western companies in sensitive sectors such as technology are encountering increasing difficulties in doing business in China and Russia, and Western countries are themselves restricting investment from geopolitical competitors in strategic sectors, it added.
It also referred to India's pledge to reach net-zero emissions by 2070 and announced a target of 50 per cent renewable energy by 2030. All the largest emitters have now agreed to start phasing out fossil fuels. "Health and economic disruptions are compounding social cleavages. This is creating tensions at a time when collaboration within societies and among the international community will be fundamental to ensure a more even and rapid global recovery. "Global leaders must come together and adopt a coordinated multi-stakeholder approach to tackle unrelenting global challenges and build resilience ahead of the next crisis," WEF Managing Director Saadia Zahidi said.
The Global Risks Report 2022 has been developed with the support of the WEF's Global Risks Advisory Board, besides from ongoing collaboration with its strategic partners, Marsh McLennan, SK Group and Zurich Insurance Group, and its academic advisers at the Oxford Martin School (University of Oxford), the National University of Singapore and the Wharton Risk Management and Decision Processes Center (University of Pennsylvania).
-With PTI Inputs