The Global Challenges Ahead

The Khmer Times, 16 January 2018

More than 2,500 leaders from government, business, civil society, international organisations, academia, media and the arts will gather in Davos, Switzerland, this month to discuss global issues and share perspectives on how to create a shared future in a fractured world.

The World Economic Forum (WEF) observes that the global environment has changed rapidly. Geopolitical competition continues to divide the world, inequality keeps rising, radicalisation and extremism remains complex and the trust between the society and the state is in decline.

Global governance remains one of the key global challenges.

Climate change is one of the top global issues that needs to be holistically addressed. World leaders had agreed to take action to limit global warming to well below 2C and strengthen societies’ ability to deal with the impacts of climate change.

Inequality, the root cause of political and social ills, is rising. A study by Credit Suisse illustrates that the richest 1 percent owns more than half of all the world’s household wealth.

The gender gap remains another global concern. The Global Gender Gap Report 2017 found that the average progress on closing the global gender gap was 68 percent, meaning that 32 percent more needs to be done.

Empirical studies have confirmed that improving gender parity results in economic dividends and one of the key avenues to address this is to close the occupational gender gap.

There are six agenda including improving global governance mechanisms, responding to a fast-changing geopolitical landscape, delivering sustainable and inclusive development, examining the regional social and economic landscape, preparing for the Fourth Industrial Revolution and reshaping global systems.

Three questions that need to be addressed are how to promote a shared narrative of the future that can bind everyone, how to transform economic development to be more inclusive and sustainable and how to create a responsive leadership that can strengthen social contracts.

To shape a shared future, the WEF has created 14 system initiatives, including consumption, digital economy and society, economic progress, education, gender and work, financial and monetary systems, food security and agriculture, health and healthcare, information and entertainment, international trade and investment, long-term investing, infrastructure and development, mobility and production.

The objective of the system initiatives is to bring together leading experts and practitioners to promote multi-stakeholder dialogue and cross-sectoral collaborations, foster innovation and suggest policy interventions.

The Global Competitiveness Report 2017-2018 raises the concern that economic recovery remains at risk due to the failure on the part of leaders and policy makers to implement necessary reforms to enhance competitiveness and productivity.

Global production has been transformed due to emerging technologies such as the Internet of Things, robotics and artificial intelligence. The changing nature of production techniques compels policy makers to develop modern industrial strategies, while taking into consideration inclusive development.

The Future Production Assessment Report 2018 posits that the most important drivers of future production are technology and innovation, human capital, institutional framework and global trade and investment.

In addition to policy design to adapt to the market forces, it is imperative that the national and global governance mechanisms be continuously reformed and strengthened. The lack of trust in public governance is due to a lack of leadership and institutional innovation.

The only constant is change.

The global institutions have to be adaptive and responsive to emerging global issues and challenges. Robust institutional reforms are necessary.

A new type of leadership is required in such an uncertain and complex world. The world needs leaders who are adaptive to changes, open to new ideas, willing to take risks and make adjustments and responsive to public concerns and fears.

“Our collective inability to secure inclusive growth and preserve our scarce resources puts multiple global systems at risk simultaneously,” said Klaus Schwab, the founder and Executive Chairman of the World Economic Forum.

“Our first response must be to develop new models for cooperation that are not based on narrow interests but on the destiny of humanity as a whole,” he added.

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