Cape Town – Decisions that are influenced by emotions are shaping the major risks the world faces in 2017, the World Economic Forum’s Global Risk Report revealed.
INFOGRAPHIC: Top 5 global risks for 2017 - WEF
The report focused on five gravity centres that will shape global risks in 2017.
“First, continued slow growth combined with high debt and demographic change creates an environment that favours financial crises and growing inequality,” WEF chair Klaus Schwab said in the report, published on Wednesday.
“At the same time, pervasive corruption, short-termism and unequal distribution of the benefits of growth suggest that the capitalist economic model may not be delivering for people.
“The transition towards a more multipolar world order is putting global cooperation under strain,” he said.
“At the same time, the Fourth Industrial Revolution is fundamentally transforming societies, economies, and ways of doing business.
“Last but not least, as people seek to reassert identities that have been blurred by globalisation, decision-making is increasingly influenced by emotions.”
The report cites the Oxford English Dictionary’s 2016 word of the year, “post-truth”, which was defined as “denoting circumstances in which objective facts are less influential in shaping public opinion than appeals to emotion and personal belief”.
It said that online discussion negatively influences users’ emotions and intensifies polarisation, creating “echo chambers” – closed, mostly non-interacting communities with different narratives, where beliefs become amplified or reinforced.
“With users on social media aiming to maximise the number of likes, information is frequently oversimplified.
“The combination of simplification and segregation provides a fertile environment for the diffusion and persistence of unsubstantiated rumours.”
Deep-rooted social and economic trends
The WEF said the report is published at a time when deep-rooted social and economic trends are manifesting themselves increasingly disruptively across the world.
“Persistent inequality, particularly in the context of comparative global economic weakness, risks undermining the legitimacy of market capitalism.
“At the same time, deepening social and cultural polarisation risks impairing national decision-making processes and obstructing vital global collaboration.
“Technology continues to offer us the hope of solutions to many of the problems we face,” it said. “But the pace of technological change is also having unsettling effects.
“These range from disrupting labour markets through automation to exacerbating political divisions by encouraging the creation of rigid communities of like-minded citizens. We need to become better at managing technological change, and we need to do it quickly."
Time to redouble efforts
It called on government, business leaders and citizens to redouble efforts to “protect and strengthen our systems of global collaboration”.
“Nowhere is this more urgent than in relation to the environment, where important strides have been made in the past year but where much more remains to be done.
“We face important risks, but also opportunities to take stock and to work together to find new solutions to our shared problems.
“More than ever, this is a time for all stakeholders to recognise the role they can play by exercising responsible and responsive leadership on global risks.”Read Fin24's top stories trending on Twitter: