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Globalisation

Cause for concern? The top 10 risks to the global economy

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Publication date: 
Thursday, February 15, 2018
Abstract in English: 
There has arguably never been a greater disconnect between the apparent strength of the global economy and the magnitude of geopolitical, financial and operational risks that organisations are facing. The Economist Intelligence Unit expects momentum in the global economy to remain strong in 2018. The US economy will continue to motor along, the euro area will absorb more of the slack in its labour markets and Chinese consumption, investment and exports will all remain strong. Higher commodity prices will prove a fillip for emerging-market exporters, while a gradual tightening of monetary conditions will not take hold to the extent that it slows growth. Taken together, these factors mean that the global economy is forecast to expand by 3% in 2018, up from a mediocre annual average pace of 2.6% in 2015-16.
Despite the encouraging headline growth figures, the global economy is facing the highest level of risk in years. Indeed, this favourable economic picture appears to come from a completely different world to the one where headlines are dominated by protectionist rhetoric, major territorial disputes, terrorism, surging cyber-crime and even the threat of nuclear war. The global economy has seen periods of high risk before, with threats emanating from the regional and the national level, as well as from state and non-state actors. What is unique about this period of heightened risk, however, is that unlike other periods in recent decades, risks are also originating from the global level, as the US questions its role in the world and partially abdicates from its responsibilities. These moves have signalled the end of the US-led global order and the beginning of a new order. Although the new order will emerge over the next decade, there will be a period of uncertainty as multiple global and regional powers vie for power and influence. For organisations attempting to negotiate these concerns in order to take advantage of the numerous and growing economic opportunities, the stakes are obviously high.
In this report we identify and assess the top ten risks to the global political and economic order. Each of the risks is not only outlined, but also rated in terms of its likelihood and its potential impact on the global economy. This is a small snapshot of our risk quantification capabilities. We also provide operational risk analysis on a country-by-country basis for 180 countries through our Risk Briefing. Meanwhile, we provide detailed credit risk assessments on 131 countries via our Country Risk Service.
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25
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Shaping the Future of Geopolitics

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Monday, November 20, 2017
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In today’s turbulent world, where governments and international organisations are increasingly faced with more uncertainty and volatility, this year’s event will zoom into emerging challenges and opportunities relevant to the European Union, highlighting the importance of strategic foresight and anticipatory governance in policy- and decision-making.
Forward-looking approaches are all the more important in a world of ‘Geopolitical Recession’, where multilateralism and the rules-based international order are under pressure, and new actors and technologies have the potential to be real geostrategic game changers. Against this backdrop, how can Europe ensure that it holds its future in its own hands? What must it do to better prepare for an uncertain future and tackle new security challenges?
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92
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African futures: Horizon 2025

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Wednesday, September 20, 2017
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If Sub-Saharan Africa’s future had to be encapsulated in a single word, it would be transformation. In recent years the continent has undergone significant economic, socio-political, and technological transformations, a process which is likely to accelerate over the coming decades. While it would be an overstatement to proclaim that the future will be African, there are strong indications that the global importance of the continent is set to rise – and not only as a source of risk factors spilling over from poverty and instability. By 2045, approximately a quarter of the world’s population will be African. Looking ahead, there is also the potential for Africa’s economic growth to outpace the global average. The expansion of foreign direct investment (FDI), which today already outstrips aid, could drive further integration of African countries in the world economy. The diversification of Africa’s relationship with external partners – which now not only include traditional Western partners such as the EU, but also Asian, Middle Eastern and Gulf countries – will also contribute to increasing Africa’s prominence in the global arena.
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84
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ASEAN 4.0: What does the Fourth Industrial Revolution mean for regional economic integration?

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Tuesday, November 14, 2017
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The report, ASEAN 4.0: What Does the Fourth Industrial Revolution Mean for Regional Economic Integration?, analyses how emerging technologies will reshape South-East Asia, and identifies actions for ASEAN leaders to prepare for the deep transformations that lie ahead. The report acknowledges the many existing national strategies for the Fourth Industrial Revolution, such as Thailand 4.0 or Singapore’s Smart Nation initiative. But it argues that ASEAN must think at the regional level, not the national level.
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20
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A Strategy for the Trans-Pacific Century

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Thursday, October 19, 2017
Abstract in English: 
The open, rules-based international order in Asia is under threat. The set of post-World War II arrangements designed by the United States and its allies and partners provided an unprecedented degree of stability, security, prosperity, and freedom globally and in the region but the continuation of this system under US leadership is no longer guaranteed. As the United States and its Asian and European allies and partners face a diverse array of new challenges in the Asia-Pacific and at home, Washington must reassess its goals, strategy, policies, and its very commitment to leadership in the region. At a time when the United States promotes “America First,” to what extent does a dated order in Asia continue to serve US and allied interests? Will the United States be willing to sustain its long-standing security-provider role in the region, and do its allies find preexisting US commitments credible? How can the United States, and likeminded Asian and European states, best contribute to security, prosperity, and democratic values in the region? Does China’s rise permit the possibility of greatpower cooperation, or is some level of competition —and even outright conflict— inevitable? To what extent, in the changing regional economic architecture, are the United States and its partners willing to make alterations in governance structure in order to adapt to the new economic weight of emerging economies? How do issues that are likely to be high-priority agenda items in the near future (e.g., food, water, and energy security; the environment; urbanization; demographic change; and disruptive technologies) challenge existing frameworks that have shaped regional affairs and societies? These are among the questions that must be addressed as the United States seeks to secure its interests in Asia, and as Asian partners look to the United States for leadership. The Asia-Pacific may be the world’s most dynamic geopolitical region. According to some projections, the majority of all global economic activity could take place within Asia by 2050.
Military might often follows economic power, and Asian countries are already spending more than European states on defense. Both of these developments reflect a broader shift in global power from West to East. If the twentieth century could be characterized as the “Trans-Atlantic Century,” the twenty-first century may well become known as the “Trans-Pacific Century.”
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69
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Global Competitiveness Report 2017-2018

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Tuesday, September 26, 2017
Abstract in English: 
Ten years on from the global financial crisis, the prospects for a sustained economic recovery remain at risk due to a widespread failure on the part of leaders and policy-makers to put in place reforms necessary to underpin competitiveness and bring about much-needed increases in productivity, according to data from the World Economic Forum’s Global Competitiveness Report 2017-2018.
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393
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EU–China Economic Relations to 2025 Building a Common Future

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Wednesday, September 13, 2017
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This report is the culmination of an 18-month study by Bruegel, Chatham House, the China Center for International Economic Exchanges and the Institute of Global Economics and Finance at The Chinese University of Hong Kong. The project was supported by a senior advisory group, with input from former ministers on both the European and Chinese sides.

The report identifies key trends and areas of potential economic collaboration in the coming decade. It cites the ‘significant opportunities’ and benefits for the two global powers to deepen their economic ties, with scope for an ‘enormous increase’ in investment in both directions. The study, however, also documents the obstacles - including significant differences between political and economic systems - which could frustrate increased collaboration, and argues that building a genuine strategic partnership will require greater effort from both EU and Chinese leaders.
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81
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The Euro’s Difficult Future

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Thursday, September 14, 2017
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In The Euro’s Difficult Future – Competitiveness Imbalances and the Eurozone’s North-South Divide author Luigi Bonatti, a professor of economics at the University of Trento in Italy, stresses that the existing North-South competitiveness divide creates growing tensions between member countries and fuels hostility towards European Union institutions. The paper illustrates why this competitiveness divide is structural, cannot be tackled by macroeconomic policies, and could threaten the euro’s survival.
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18
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Global Trendometer - Essays on medium- and long-term global trends

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Monday, September 4, 2017
Abstract in English: 
The European Union has come through difficult years. A succession of crises, often interlinked, have been the major concern of European leaders for much of the past decade. This experience has driven home the lesson that prevention is better than the cure, and that more can be done to identify and prepare for future challenges. The EU as a whole has worked to enhance its foresight capacity, notably through the work of the inter-institutional ESPAS process. For its part, the European Parliament is placing greater emphasis on agenda-setting and on horizon scanning, both to support its work in shaping the future through legislation and to improve the quality of public policy discussion of key challenges and choices ahead.
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62
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Charting the Future Now: European Economic Growth and its Importance to American Prosperity

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Publication date: 
Friday, March 10, 2017
Abstract in English: 
The European Union (EU), a vital partner for the United States, is facing numerous challenges, including massive migration flows, the UK’s vote to leave the EU (Brexit), and rising support for anti-EU and populist parties in upcoming elections in several European countries. In Charting the Future Now: European Economic Growth and its Importance to American Prosperity, the Atlantic Council’s EuroGrowth Initiative proposes pragmatic steps to restore European economic growth, safeguard the European project, and reinvigorate the transatlantic alliance.
Backed with rigorous data, the report highlights the crucial importance of the European economy for the US and proposes ways to galvanize the transatlantic relationship. Focusing on feasible projects and reforms, the report then looks at various policy proposals to increase growth and create jobs in the short, medium, and long term.
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76
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