Leaders have a pivotal opportunity to shape a new normal as Covid-19 continues to disrupt the world, the World Economic Forum (WEF) said in its Covid-19 Risks Outlook report, released yesterday.
Prolonged recession, job losses, protectionism and another outbreak of infectious diseases top the list of near-term worries for risk professionals globally.
Cyber attacks, data fraud, the breakdown of IT infrastructure, geopolitical disruptions and tighter curbs on the movement of people and goods are high on the list of concerns, and several countries are not ready for the far-reaching environmental, societal and technological risks ahead, according to WEF.
Still, the pandemic, with its 4.5 million cases worldwide and more than 300,000 deaths, also presents an opportunity and an urgent need to shape a better world - with greater social equality and sustainability becoming part of the recovery process, said the report.
WEF managing director Saadia Zahidi said the pandemic has "revealed the inadequacies of the past", adding: "We have a unique opportunity to use this crisis to do things differently and build back better economies that are more sustainable, resilient and inclusive".
The report is based on a survey of nearly 350 senior risk professionals who were asked to rank the top risks to the world and businesses over the next year and a half.
The economic fallout dominates perceptions of risk in the poll that also examined societal, tech, geopolitical and environmental risks.
Nearly two-thirds of the respondents ranked a "prolonged global recession" as a top concern in the short term, while half of all respondents were anxious about high levels of unemployment, bankruptcies and industry consolidation, failure of industries to recover and disruption of supply chains.
There is also growing concern over a rise in cyber attacks against companies and curbs on cross-border movement of people and goods that could remain up to 2021.
On the societal front, respondents worry about worsening anxiety as a result of entrenched unemployment, inter-generational friction and the pressure of fear and isolation on mental heath.
And on the environmental front, "even with an expected 8 per cent drop in global emissions for this year, the world would still miss the 1.5 deg C target to avoid a planetary catastrophe", said Mr Emilio Granados Franco, head of global risks and geopolitical agenda at WEF, referring to the limit set out in the Paris Agreement for global warming.
"Climate degradation will worsen if countries fail to embed sustainability criteria into their recovery plans," he said.
"A virus has taken away the luxury of planning. We can no longer wait for the right moment to time such reforms, but we can still make sure they are the right ones," he added.
The report was produced by WEF's global risks advisory board in partnership with professional services firm specialising in risk, strategy and people Marsh & McLennan, and the Zurich Insurance Group.
A pandemic in numbers
People at risk of falling into poverty
Expected drop in world output
Anticipated fall in global trade
Estimated drop in foreign direct investments
Students worldwide (1.6 billion) out of school in March 2020
Adults feeling adverse effects on their mental health during lockdown
Rise in unemployment results in 2% increase in chronic illness
SOURCE: WORLD ECONOMIC FORUM