World Economic Forum Lists Biggest Global Risks of 2022

The world is a pretty scary place in 2022. COVID-19 infections are hitting all-time highs and the World Health Organization is warning that, despite the hopes of some public officials, the virus’s spread is far from over. And political divides are wider than ever.

Figuring out which problem to focus on can be a challenge.

The World Economic Forum has some ideas, though. The group’s 17th annual Global Risks Report examines the top threats that require urgent global action – and the items on the list might not always be what you expect. (Let’s put it this way, infectious diseases only ranked sixth in the midst of a global pandemic.)

Overall, there’s a lot of pessimism out there. Just 16% of the 1,000 respondents (a mix of experts and leaders) to the study said they are positive or optimistic about the outlook for the world. Some 61% said they were concerned, while another 23% said they were worried.

"As 2022 begins, COVID-19 and its economic and societal consequences continue to pose a critical threat to the world. Vaccine inequality and a resultant uneven economic recovery risk compounding social fractures and geopolitical tensions," the report said. "The resulting global divergence will create tensions —within and across borders — that risk worsening the pandemic’s cascading impacts and complicating the coordination needed to tackle common challenges including strengthening climate action, enhancing digital safety, restoring livelihoods and societal cohesion, and managing competition in space."

Environmental concerns actually sound the loudest alarm for the WEF. The top three global risks (as ranked by severity over the next 10 years) were environmental in nature: Climate action failure, extreme weather events, and biodiversity loss and ecosystem collapse. And five of the top 10 were tied to environmental concerns.

“Humans are not good in the boiling frog scenario, which is climate change, they’re much better in the fight or flight scenario, which has been the pandemic,” notes Peter Giger, group chief risk officer at Zurich Insurance Group

Societal risks were of nearly as great concern, occupying three of the Top 10 slots, with the others (at the bottom) being filled by economic and geopolitical worries.

Here’s a look at the WEF’s Top 10 Global Risks by Severity:

1. Climate action failure
2. Extreme weather
3. Biodiversity loss
4. Social cohesion erosion
5. Livelihood crises
6. Infectious diseases
7. Human environmental damage
8. Natural resource crises
9. Debt crises
10. Geoeconomic confrontation

Many of those same concerns made the short-term list, though extreme weather was the biggest anxiety over the next 0-2 years. Also on that list was mental health deterioration, cybersecurity failure, digital inequality and an asset bubble burst. Economic and debt-related issues are cited as significant medium-term dangers.

“Our planet is on fire and we have to deal with it,” said Borge Brende, president of the World Economic Forum in a statement. “This is a risk we know. We are not faced with a blind spot.”

The study raised worries that the global recovery from the pandemic will continue to be a volatile one. A common theme among respondents was a desire to see global leaders work closer together to solve global problems, though the report acknowledges that geopolitical tensions, which are spilling over into the economic sphere will make it more difficult to tackle common global challenges.

“The global divergence that risks resulting from ruptures within the world economy, stronger competition for geopolitical advantage, and domestic pressures to prioritize national objectives will create complex challenges for global cooperation over the next years,” it says. “The COVID-19 pandemic exposed the shortcomings of global cooperation, but the way forward is not clear. There is a need for stronger global governance and more effective international risk mitigation efforts … yet coming together with the common purpose to achieve lasting results will be challenging.”

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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Sustainability ESG Coronavirus Economy Politics