Unemployment weather Extreme weather Natural disasters Terrorist attacks Data fraud or theft Involuntary migration Income disparity Fiscal imbalances Greenhouse gas Cyberattacks Water crises emissions Involuntary migration Interstate conflict Natural catastrophes Extreme weather Climate action failure Extreme weather Cyberattacks Data fraud or theft Natural disasters Climate action failure Extreme weather Natural disasters Data fraud or theft Climate action Cyberattacks failure 2013 2014 2015 2017 2012 2016 2018 2019 2020 Extreme weather Natural disasters Biodiversity loss Human-made environmental disasters Climate action failure 2021 Extreme weather Human environmental damage Climate action Infectious diseases failure Biodiversity loss Digital power concentration Digital inequality 2021 Infectious diseases Weapons of mass destruction Climate action Biodiversity loss failure Natural resource crises Human Livelihood crises environmental damage Fiscal imbalances 1st 2nd 3rd 4th 5th 2013 2014 2015 2017 2012 2016 2018 2019 2020 Climate action failure Extreme weather Water crises Natural disasters Weapons of mass destruction Financial failure Water crises Food crises Energy price volatility Fiscal imbalances Weapons of mass destruction Extreme weather Natural Water crises disasters Climate action failure Weapons of mass destruction Extreme weather Water crises Natural disasters Climate action failure Energy price shock Water crises Involuntary migration Weapons of mass destruction Climate action failure Fiscal crises Infrastructure breakdown Climate action Water crises Unemployment failure Water crises Infectious diseases Weapons of mass destruction Interstate conflict Climate action failure Financial failure Water crises Weapons of mass destruction Fiscal imbalances Climate action failure Extreme weather Weapons of Water crises mass destruction Climate action Biodiversity loss failure Source: World Economic Forum Global Risks Perception Survey 2020 FIGURE IV Evolving Risks Landscape The Global Risks Report 2021 15 Global Risks 2021: Fractured Future CHAPTER 1 REUTERS/CABEZAS The Global Risks Report 2021 16 The immediate human and economic costs of COVID-19 are severe. They threaten to scale back years of progress on reducing global poverty and inequality and further damage social cohesion and global cooperation, which were already weakening before the virus struck. New barriers to individual and collective advancement will likely result from the pandemic as the world faces the sudden disruption of social interactions, a widening digital divide, abrupt shifts in markets and consumer behaviour, loss of education and jobs, and challenges to democracy and international relations. “Digital inequality”, “youth disillusionment” and “social cohesion erosion”—newly included in the Global Risks Perception Survey (GRPS)— were all identified by respondents as critical short-term threats. A digital leap forward—disrupting industry, education, labour markets, and the balance of power between nations— risks widening the gap between the technological “haves” and “have-nots”. All generations and groups have been affected by the crisis: older populations are the most vulnerable to the pandemic itself, and youth face new barriers to social mobility, strains on mental health, uncertain economic prospects and the continued degradation of the planet. Climate change—to which no one is immune, nor can the world vaccinate against it—continues to be catastrophic: “climate action failure” is the most impactful and second most likely longterm risk identified in the GRPS. Billions of people worldwide are at heightened risk of missing out on future economic opportunities, and the benefits of a resilient global community. According to the GRPS, “livelihood crises” will be a critical threat over the next two years, and their impact is likely to continue throughout the decade. The crisis has also challenged national policy-making and international relations in ways that threaten lasting impacts. Institutions and policies to support international coordination were already in decline, and responses to the pandemic have caused new geopolitical tensions. With new stalemates and flashpoints in view, GRPS respondents rated “state collapse” and “multilateralism collapse” as critical threats over the next five to ten years. Despite these challenges, there is also space for building resilience. In this chapter, we close with a reflection on how governments, businesses and societies can begin to take steps for better preparedness in the face of perpetual global risk (see Box 1.1). Damage and disparity The effects of COVID-19, along with some aspects of the policy response, however necessary, have left societies and economies damaged, widened existing disparities within communities and between nations, disproportionately harmed certain sectors and societal groups, and complicated the pathway for the world to achieve the United Nations Sustainable Development Goals by 2030. Economic shockwave The global economy has now sunk to its deepest crisis in peacetime. World output is expected to have shrunk by 4.4% in 2020 (see Figure 1.1).1 In comparison, the 2008–2009 Financial Crisis caused the world economy to contract by 0.1%. Data for the third quarter of 2020 hinted that recovery