The World Economic Forum has published a report on the state of the global economy in advance of its annual meeting, scheduled to be held in the Swiss resort of Davos January 23 to 27.
The Forum’s “Global Risk Report 2008” has a distinctly insurance industry flavor to it. The Marsh & McLennan Companies, Swiss Re and Zurich Financial Services, along with Citigroup and the Wharton School Risk Center, prepared the document.
It “highlights key areas of risk that will be a focus of discussions by business leaders and public policymakers at the Annual Meeting of the World Economic Forum in Davos later this month,” said a Marsh press release.
A Forum bulletin said the report “highlights the need for new thinking and concerted action in a number of problem areas. It expresses fears that the current liquidity crunch will spark a US recession in the next 12 months and calls for new thinking on systemic financial risk in response to the revolution in financial markets over the last two decades.”
It “recommends a set of principles for country risk management and examines how the financial sector might take on an increasingly important role in risk transfer in the future.”
The report also warns: “Food security will become an increasingly complex political and economic problem over the next few years, with issues of equity and trade offs between security and other issues making the design of global policy both difficult and necessary. Greater co-operation on managing vulnerabilities associated with cross-border supply chains and concentrations of production may also be needed. Finally, with the dollar price of oil at record highs, the report recommends an improved approach to securing viable energy supplies in the years ahead.”
The Davos conference has brought together leaders from all over the world for the World Economic Forum Annual Meeting. Over the last 30 years it “has provided an unrivalled platform for leaders from all walks of life to shape the global agenda at the start of each year,” said a bulletin on the Forum’s web site (http://www.weforum.org/en). It’s unique in that not only are government and business leaders in attendance, but also the media, academics, artists and civic leaders.
The Forum’s bulletin noted that a “shifting power equation” framed discussions at last year’s conference. The shift “will continue to influence the strategies of business, government and other stakeholders in the world economy.”
However the Forum also said a “closer examination of the international environment also reveals that leadership vacuums are beginning to emerge on a wide range of critical issues looming on the horizon. Moreover, a paradox has emerged in our networked world where knowledge is ubiquitous and change is rapid, but the absence of a common vision and agenda ensures that the status quo will be maintained with respect to major global challenges.”
This year’s agenda will focus on ways of achieving more “collaboration and innovation” in exploring ways to “leverage the Forum’s multistakeholder model so that platforms can be built for like-minded communities to initiate necessary changes together.”
The Annual Meeting 2008 program will be based on the following five conceptual pillars: Business– Competing While Collaborating; Economics and Finance – Addressing Economic Insecurity; Geopolitics – Aligning Interests across Divides; Science and Technology – Exploring Nature’s New Frontiers; Values and Society – Understanding Future Shifts
The problems currently confronting the nations of the world run the gamut from basic needs – threatened by climate change – to how to regulate arcane financial instruments that already threaten to destabilize the global economy. It’s no accident that three insurance industry heavyweights are involved. Ultimately they will be called upon to underwrite the risks the global economy faces.
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