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Economic, political tension fueling increased global risks: WEF report

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Economic, political tension fueling increased global risks: WEF report

The tension between the globalization of the world economy and the growing nationalism of world politics is a growing risk in 2019, leading to policy inaction on major challenges like environmental risks, according to the World Economic Forum’s Global Risks Report 2019, published Wednesday.

The report, which is based on a survey of about 1,000 risk experts, found that 85% of respondents expect 2019 to involve increased risks of “political confrontations between major powers.”

Growth in 2019 will be held back by continuing geoeconomic tensions, the report said, with 88% of respondents expecting further erosion of multilateral trading rules and agreements.

Economic risks drew renewed concerns in this year’s report, as financial market volatility increased in 2018 and headwinds facing the global economy intensified.

According to the report, produced in conjunction with strategic partners Marsh & McLennan Cos. Inc. and Zurich Insurance Group Ltd., the top five risks in terms of likelihood are:

  • Extreme weather events
  • Failure of climate-change mitigation and adaptation
  • Natural disasters
  • Data fraud or theft
  • Cyberattacks

The top five risks in terms of impact are:

  • Weapons of mass destruction
  • Failure of climate change mitigation and adaptation
  • Extreme weather events
  • Water crises
  • Natural disasters

Environmental concerns continue to dominate the risks landscape, with a growing number of respondents worried about environmental policy failure, the report found.

Failure of climate change mitigation and adaptation jumped back to number two in terms of impact this year, as “the results of climate inaction become increasingly clear,” the report said.

Cybersecurity risks remain a top challenge in 2019, according to the WEF report, and business concerns are not limited to data fraud and cyberattacks.

Some two-thirds of respondents expect the risks associated with fake news and identity theft to increase in 2019, while three-fifths said the same about loss of privacy to companies and governments, the report said.

“There were further massive data breaches in 2018, new hardware weaknesses were revealed and research pointed to the potential uses of artificial intelligence to engineer more potent cyberattacks,” the report said.

 

 

 

 

 

 

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