More than two-thirds of people on the planet – between 4–5bn – could be living in parts of the world affected by water stress by 2024. That was the warning issued by Axel Lehmann, chief risk officer for Zurich Insurance Group, which is backer of the WEF report published yesterday (January 15).
Today around 10% of the world’s population struggles to get access to clean water, he added.
Tensions between water-stressed regions of the world and those with reserves could potentially lead to “water wars”, claimed John Drzik, president of global risk at Marsh & McLellan, which also supports the WEF report.
Interstate conflict with regional consequences was the biggest risk in terms of its likelihood, according to the study. Other top risks identified were the rapid and massive spread of infectious diseases, weapons of mass destruction and failure of climate change adaption.
The Global Risks 2015 report, now in its 10th year, is intended to inform discussions between world leaders, businesses leaders and non-governmental organisations at the WEF summit in Davos, in Switzerland next week.
The report is an assessment by 896 Global experts from the business, academic and non-governmental organisation (NGO) world on the top risks from a list of 28 over the coming 10 years.
These are divided into five categories covering economic, environmental, geopolitical, societal and technological risks.
Interstate conflict
While interstate conflict, such as that between Russia and the Ukraine and between China and Japan, is the most likely risk, it is the fourth most serious in terms of impact. In terms of likelihood, it exceeds extreme weather events, which comes second, failure of national governance systems (3), state collapse or crisis (4) and high structural unemployment or underemployment (5).
“The challenge now is that people are again recognising what we can call the return of strategic competition between key players,” said Espen Barth Eide, WEF md and a member of its managing board.
“This means that major economies are now in conflict with each other, not as in a world war, but in a direct shooting conflict, including the one most characteristic of this, which is happening in Ukraine, but which is in reality a major power play between Russia and European and the US.”
Barth Eide added: “And we have a Middle East in which we have a state system that seems to be collapsing and the rise of the Islamic State with regional and global consequences.
“What that means is we will have a simultaneous challenge in the security area of symmetrical and asymmetrical tension at the same time. So, relics of the cold war are coming back in a new form and we will have the continuation of more asymmetrical challenges, like the rise of non-state violent actions.”
“What we are furthermore pointing out is that this is closely related to the economy … now we see that politics is coming back in the form of sanctions and the use of economic tools as a part of strategic competition … maybe trade wars and the return of protectionism.”
Technological risks
The rapid pace of innovation in emerging technologies, from synthetic biology and nanotechnology to artificial intelligence, also had far-reaching societal, economic and ethical implications, said the WEF.
Developing regulatory environments that could safeguard the rapid development of such technologies and allow their benefits to be reaped, while preventing their misuse and unforeseen negative consequences was a critical challenge for leaders, it added.
“Innovation is critical to global prosperity, but also creates new risk,” said Drzik. “We must anticipate the issues that will arise from emerging technologies, and develop the safeguards and governance to prevent avoidable disasters.”
It was noteworthy that there were more environmental risks among the top risks than economic ones in this year’s report, said the WEF.
‘Competition for resources’
“Twenty-five years after the fall of the Berlin Wall, the world again faces the risk of major conflict between states,” said Margareta Drzeniek-Hanouz, lead economist with the WEF. “However, today the means to wage such conflict, whether through cyberattack, competition for resources or sanctions and other economic tools, is broader than ever.
“Addressing all these possible triggers and seeking to return the world to a path of partnership, rather than competition, should be a priority for leaders as we enter 2015.”
While many leaders will be in Davos next week, prime minister David Cameron will not be going, according to press reports. This will be the first time a British prime minister has not attended the annual gathering since 2007.