The World Economic Forum’s annual risk report showed a sharp rise in pessimism about the global outlook, with executives and executives being concerned about the longer-term effects of the pandemic.

84% of the nearly 1,000 business experts surveyed worldwide, Technology and politics are concerned about the global outlook, less than 4% optimistic. Many respondents expected the next three years to be marked by continued volatility and surprises.

The report’s authors said the emergency response to the pandemic, while uncoordinated, successfully averted the worst outcomes – despite the global economy in the year 2024 will still be 2.3% smaller than it would have been without Covid19. The changes brought about by the pandemic would have increased the recovery and resilience building challenges that economies and businesses need, the report released on Tuesday said.

The pandemic has also undermined social cohesion in many countries, mental health deteriorates and the gap between rich and poor countries widens. The weak outlook, influenced by soaring commodity prices, inflation and growing debt problems, increases the risk of disrupting efforts to reduce carbon emissions, the report said.

Failure to address climate change remains the biggest asset – and long-term risk seen by the respondents. Over the five to ten year period, all five of the greatest risks were classified as environmental risks and included extreme weather conditions, loss of biodiversity and crises in natural resources and debt crises identified.

The report is usually published before the WEF annual meeting in Davos Switzerland. But this has been postponed for the second year in a row because of the pandemic, despite the fact that the forum holds online events.

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Carolina Klint of Marsh, the insurance broker and risk advisor who worked on the report, said the pandemic exposed the downside of pursuing efficiency and growth versus goals like resilience and sustainability.

“I think the pandemic has shown that companies that are too lean can leave businesses and societies vulnerable to shocks, ”he said. said Mrs. Klint. “So it can be a great way to help people and societies and governments recover faster.” However, protectionist policies to increase resilience would fuel the global recovery from Covid-19 hinder said WEF President

BÃrge Brende,

because globalization has driven much of the growth of the past few decades.

There are other tensions as governments seek to encourage recovery while some seek to pay off the debts they have built up in recent years. Saadia Zahidi, executive director of the WEF, said resolving these tensions would require “some pretty big structural changes in the way economies work”. including some potentially unpopular taxation measures.

On the other hand, said

Peter Giger,

Group Chief Risk Officer of Zurich Insurance Group, another partner on the report, “One of the negative effects of the pandemic is the public perception [that] we can keep anything afloat with public money.”

A separate survey of 12,000 executives found that in 31 out of 124 countries surveyed – including Argentina, France, Germany, Mexico and South Africa – erosion of social cohesion was seen as a top 10 short-term threat.

Meanwhile, the gap between rich and poor countries was looming grow – in part because of the wide disparities observed in vaccination rates.

The report also raised concerns about increasing geopolitical divisions and competition in emerging areas such as the militarization and armament of space and developments in cyberspace.

Ref: https://www.wsj.com