It’s probably not really what Australia’s conservative Liberal-National Prime Minister Tony Abbott wants to hear while he struts the stage at the World Economic Forum (WEF) in the Swiss ski resort of Davos.
The WEF Annual Global Risk report has again highlighted climate change and extreme weather as big risks for the global economy over he next decade.
Climate change and related risks such as extreme weather impacts and water shortages have again been listed amongst the most serious risks faced by the global economy over the next decade by the WEF.
Mr Abbott, who is only the second Australian PM to attend the economic summit, aims to focus on his agenda for the G20 meeting to be held in the Queensland state capital of Brisbane later this year.
His government is currently trying to repeal Australia’s carbon price laws and various other mechanisms introduced by the former Labor government to deal with climate change.
Publishing its latest Global Risks report ahead of this week’s annual WEF Summit in Davos, the group listed the “most likely” risks faced by the global economy over the next decade as social risks associated with income disparity, environmental risks presented by extreme weather events, the impact of unemployment and underemployment, climate change impacts, and cyber attacks.
It also listed those risks that would potentially have the greatest impact, warning that fiscal crises, climate change, water crises, unemployment and underemployment, and critical information infrastructure breakdown could all deal major blows to the global economy.
“Each risk considered in this report holds the potential for failure on a global scale; however, it is their interconnected nature that makes their negative implications so pronounced as together they can have an augmented effect,” said Jennifer Blanke, chief economist at the World Economic Forum, in a statement.
“It is vitally important that stakeholders work together to address and adapt to the presence of global risks in our world today.”
British environmental website BusinessGreen reports the report emphasises how many of the risks presented are interconnected.
For example, it notes how the large populations of young people in emerging economies face a series of inter-locking risks, such as climate change, rising food prices, water stress, high unemployment, and income inequality, that could all serve to spark social unrest.
The report also features the results of a survey of over 700 senior business leaders, policy makers and other experts that again emphasises how environmental and economic risks are tightly integrated.
“The risks considered high impact and high likelihood are mostly environmental and economic in nature: greater incidence of extreme weather events, failure of climate change mitigation and adaptation, water crises, severe income disparity, structurally high unemployment and underemployment and fiscal crises in key economies,” the report states.
“Female respondents perceived almost all global risks as both more likely and more impactful than did males, especially in the environmental category.
“Younger individuals gave higher scores for the impact of almost all of the risks, particularly environmental risks, such as water crises, greater incidence of natural catastrophes, the loss of biodiversity and greater incidence of extreme weather events.”
In addition to highlighting the potential impact of climate-related risks, the WEF report details how an increasingly “multi-polar world” could make it harder for countries to deliver a co-ordinated response to global risks, such as climate change and extreme weather.
For example, slow progress in addressing global challenges is identified as a “key threat that could each impact global stability in the next five to 10 years”.
“A more fractured geopolitical environment threatens to impede progress in industries which are critical to global development, such as financial services, healthcare and energy,” said John Drzik, president of global risk management firm Marsh.
“The world needs more coordinated governance to prevent slow-burning, systemic risks from developing into full-blown crises.”
One Response