World forum warns of risks

The World Economic Forum’s annual report Global Risks 2010, said events of the past year demand a change thinking on global risks and global cooperation to manage them.

The report included:

• A number of underlying risks that contributed to and were exacerbated by the financial crisis and global economic downturn
• Fiscal crises and unemployment, underinvestment in infrastructure – especially in energy and agriculture – and chronic disease identified as the pivotal areas of risk
• Transnational crime and corruption, biodiversity loss and cyber-vulnerability identified as equally systemic and requiring better global governance
• The need to combat governance gaps globally is greater than ever, requiring an overhaul of current values and behaviours by decision-makers to improve coordination and supervision.
• Current models for health, education and unemployment protection have been put under severe strain by the fiscal crisis. This will worsen with increasing life expectancy

Robert Greenhill, managing director and chief business officer at the World Economic Forum, said: “We must face up to the challenges created by these unprecedented levels of interconnectedness between risks.

“The financial crisis and the ensuing recession have created a more vulnerable environment where unaddressed risks may become tomorrow’s crises.”

Global cooperation

The Global Risks report is published yearly ahead of the World Economic Forum Annual Meeting in Davos-Klosters, Switzerland, and is produced in partnership with Citigroup, Marsh & McLennan Companies (MMC), Swiss Re, the Wharton School Risk Center and Zurich Financial Services.

The result of year-long consultations with experts from business, academia and policy-making, Global Risks 2010 marks the fifth edition of the report, coinciding with the 40th anniversary of the Forum.

Sheana Tambourgi, editor of the report said: “The next few months will put the willingness among global decision-makers to cooperate on addressing global risks to the test. Simply reverting to ‘business as usual’ could have serious implications in the long term in several risk areas.”