Buzz phrases like, “chronic labour-market imbalances” and “the unforeseen consequences of climate-change mitigation” abound . Heady stuff, but worth reading anyway. The report highlights potholes that can be avoided with careful planning and also opportunities that may arise from these threats.
The WEF looks at some obvious problems, such as increasing levels of inequality and the fragility of the global economic system, but also focuses on two less obvious threats; one lurking in your inbox and the other in your medicine cabinet.
Firstly, there is a possibility that ‘digital wildfires’ could wreak global havoc. The internet can spread disinformation instantaneously, with human and robotic traders acting on it immediately. In July2012, oil prices rose more than $1 a barrel after a Twitter user, impersonating the Russian interior minister, tweeted that Syrian president, Bashar Assad, had been killed or injured.
In October, NASDAQ halted trading in Google’s shares after a leaked earnings report led to a $22bn drop in the company’s capitalisation and even the hallowed BBC was brought to its knees after a news programme prompted Twitter users to accuse an innocent politician of paedophilia.
Well, companies have always had to exercise judgement when faced with new information and the rise of social media simply means they need to be a bit quicker on their toes, however that information is delivered.
A more disturbing part of the report looks at the issue of antibiotics. Pain relief and antibiotics are the greatest developments in the history of medicine and antibiotics have probably saved more lives than any other invention ever. However, it seems that they are losing their effectiveness, mostly due to overuse.
The number of infections that are resistant to treatment by antibiotics is on the rise and the development of new antibiotics is slowing, as pharmaceutical companies shift their attention to chronic and more lucrative illnesses, such as diabetes and hypertension.
The report claims it should be much harder to get hold of antibiotics. I must declare a personal interest here, as I am currently receiving a five-week course of very strong antibiotics for an infection following an arm operation and will return to the subject of these drugs in my next article.
In China, where hospitals make much of their revenue from the drugs they sell, 98% of children at a Beijing hospital were prescribed antibiotics for the common cold; they absolutely do not work for viral infections. They are also overused in farming livestock and fish, entering the food-chain and making them less effective. If antibiotics stop working and no more are developed, we are essentially screwed.
Another report, by consultancy, Eurasia, takes on political risks. Eurasia believes the worst risks come from the emerging world of nations. The rich world has shown itself fairly capable of managing risks (antifragile), but emerging countries have little or no experience in coping with volatility or crashes.
Obviously, this is a broad brushstroke; Spain and Italy are hardly antifragile and lumping countries together, with acronyms such as BRICs, hardly scientific. But businesses gloss over political risks in the emerging world at their peril – and their lumping emerging countries into regions is also a bit, well, dumb and normally marketing-led.
So, the globalisation of IT, the threat of ineffective antibiotics and the premise that the emerging world is a very complicated one, should give everyone pause for thought. Nice if you’re doing it in Davos of course.