Visualized: A Global Risk Assessment of 2022 and Beyond
Since the start of the global pandemic, we’ve been navigating through tumultuous waters, and this year is expected to be as unpredictable as ever.
In the latest annual edition of the Global Risks Report by the World Economic Forum (WEF), it was found that a majority of global leaders feel worried or concerned about the outlook of the world, and only 3.7% feel optimistic.
Ever year, the report identifies the top risks facing the world, as identified by nearly 1,000 surveyed experts and leaders across various disciplines, organizations, and geographies.
What global risks are leaders and experts most concerned about, and which ones are posing imminent threats? Let’s dive into the key findings from the report.
Methodology for WEF’s Global Risk Assessment
In the survey, respondents were asked to compare 37 different risks, which were broken down into five categories: economic, environmental, geopolitical, societal, and technological.
To get a sense of which risks were seen as more urgent than others, respondents were asked to identify when they believed these threats would become a serious problem to the world, based on the following timeframes:
- Short-term threats: 0-2 years
- Medium-term threats: 2-5 years
- Long-term threats: 5-10 years
By categorizing global risks into these time horizons, it helps provide a better idea of the problems that decision makers and governments may have to deal with in the near future, and how these risks may interrelate with one another.
When it comes to short-term threats, respondents identified societal risks such as “the erosion of social cohesion” and “livelihood crises” as the most immediate risks to the world.
|Timeframe||Category||Threat||% of Respondents|
|0-2 years||🟢 Environmental||Extreme weather||31.1%|
|0-2 years||🔴 Societal||Livelihood crises||30.4%|
|0-2 years||🟢 Environmental||Climate action failure||27.5%|
|0-2 years||🔴 Societal||Social cohesion erosion||27.5%|
|0-2 years||🔴 Societal||Infectious diseases||26.4%|
|0-2 years||🔴 Societal||Mental health deterioration||26.1%|
|0-2 years||🟣 Technological||Cybersecurity failure||19.5%|
|0-2 years||🔵 Economic||Debt crises||19.3%|
|0-2 years||🟣 Technological||Digital inequality||18.2%|
|0-2 years||🔵 Economic||Asset bubble burst||14.2%|
These societal risks have worsened since the start of COVID-19. And as emerging variants threaten our journey towards normalcy, the pandemic continues to wreak havoc worldwide, with no immediate signs of slowing down.
According to respondents, one problem triggered by the pandemic is rising inequality, both worldwide and within countries.
Many developed economies managed to adapt as office workers pivoted to remote and hybrid work, though many industries, such as hospitality, still face significant headwinds. Easy access to vaccines has helped these countries mitigate the worst effects of outbreaks.
Regions with low access to vaccines have not been so fortunate, and the economic divide could become more apparent as the pandemic stretches on.
A majority of respondents believe we’ll continue to struggle with pandemic-related issues for the next three years. Because of this, the medium-term risks identified by respondents are fairly similar to the short-term risks.
|Timeframe||Category||Threat||% of Respondents|
|2-5 years||🟢 Environmental||Climate action failure||35.7%|
|2-5 years||🟢 Environmental||Extreme weather||34.6%|
|2-5 years||🔴 Societal||Social cohesion erosion||23.0%|
|2-5 years||🔴 Societal||Livelihood crises||20.1%|
|2-5 years||🔵 Economic||Debt crises||19.0%|
|2-5 years||🟢 Environmental||Human environmental damage||16.4%|
|2-5 years||🟡 Geopolitical||Geoeconomic confrontations||14.8%|
|2-5 years||🟣 Technological||Cybersecurity failure||14.6%|
|2-5 years||🟢 Environmental||Biodiversity loss||13.5%|
|2-5 years||🔵 Economic||Asset bubble burst||12.7%|
The pressing issues caused by COVID-19 mean that many key governments and decision-makers are struggling to prioritize long-term planning, and no longer have the capacity to help out with global issues. For example, the UK government postponed its foreign aid target until at least 2024. If countries continue to prioritize themselves in an effort to mitigate the impact of COVID-19, the inequality gap could widen even further.
Respondents also worry about rising debt levels triggering a crisis. The debt-to-GDP ratio globally spiked by 13 percentage points in 2020, a figure that will almost certainly continue to rise in the near future.
Respondents identified climate change as the biggest threat to humanity in the next decade.
|Timeframe||Category||Threat||% of Respondents|
|5-10 years||🟢 Environmental||Climate action failure||42.1%|
|5-10 years||🟢 Environmental||Extreme weather||32.4%|
|5-10 years||🟢 Environmental||Biodiversity loss||27.0%|
|5-10 years||🟢 Environmental||Natural resource crises||23.0%|
|5-10 years||🟢 Environmental||Human environmental damage||21.7%|
|5-10 years||🔴 Societal||Social cohesion erosion||19.1%|
|5-10 years||🔴 Societal||Involuntary migration||15.0%|
|5-10 years||🟣 Technological||Adverse tech advances||14.9%|
|5-10 years||🟡 Geopolitical||Geoeconomic confrontations||14.1%|
|5-10 years||🟡 Geopolitical||Geopolitical resource contestation||13.5%|
Climate inaction—essentially business as usual—could lead to a global GDP loss between 4% and 18%, with varying impacts across different regions.
Experts also pointed out that current decarbonization commitments made at COP26 last year still aren’t enough to slow warming to the 1.5°C goal set in the Paris Climate Agreement, so more action is needed to mitigate environmental risk.
That said, efforts to curb climate change and solve long-term issues will likely have negative short-term impacts on the global economy and society. So risk mitigation efforts need to be in place as we work to reach net-zero and ultimately slow down climate change.
Risk Mitigation Efforts
People’s thoughts on risk mitigation were gauged in the WEF survey. Respondents were asked to identify which risks our world is most equipped to handle, and which ones they believe we’re less prepared for.
“Trade facilitation,” “international crime,” and “weapons of mass destruction” were risks that respondents felt we’ve effectively prepared for. On the flip side, “artificial intelligence” and “cross-border cyberattacks and misinformation” are areas where most respondents think we’re most unprotected against.
As society becomes increasingly reliant on digital infrastructure, experts predict we will see an uptick in cyber attacks and cybercrime. New AI-enabled technologies that offer ransomware-as-a-service allow anyone to engage in cybercrime—even those without the technical knowledge needed to build malware.
How Do We Move Forward?
Based on the findings from this year’s survey, WEF identified five lessons that governments, businesses, and decision-makers should utilize in order to build resilience and prepare for future challenges:
- Build a holistic mitigation framework: Rather than focusing on specific risks, it’s helpful to identify the big-picture worst-case scenario and work back from there. Build holistic systems that protect against adverse outcomes.
- Consider the entire ecosystem: Examine third-party services and external assets, and analyze the broader ecosystem in which you operate.
- Embrace diversity in resilience strategies: Not all strategies will work across the board. Complex problems will require nuanced efforts. Adaptability is key.
- Connect resilience efforts with other goals: Many resilience efforts could benefit multiple aspects of society. For instance, efficient supply chains could strengthen communities and contribute to environmental goals.
- Think of resilience as a journey, not a destination: Remaining agile and vigilant is vital when building out resilience programs, as these efforts are new and require reflection in order to improve.
The next few years will be riddled with complex challenges, and our best chance at mitigating these global risks is through increased collaboration and consistent reassessment.
When Will Air Travel Return to Pre-Pandemic Levels?
COVID-19 hit the air travel industry hard. But passenger traffic is slowly recovering, and by 2025, things are expected to return to ‘normal.’
When Will Air Travel Return to Pre-Pandemic Levels?
Many industries were hit hard by the global pandemic, but it can be argued that air travel suffered one of the most severe blows.
The aviation industry as a whole suffered an estimated $370 billion loss in global revenue because of COVID-19. And while air travel has been slowly recovering from the trough, flight passenger traffic has yet to fully bounce back.
Where is the industry at in 2022 compared to pre-COVID times, and when is air passenger travel expected to return to regular levels? This graphic by Julie R. Peasley uses data from IATA to show current and projected air passenger ridership.
Air Travel Traffic: 2021 and 2022
After an incredibly difficult 2020, the airline industry started to see significant improvements in travel frequency. But compared to pre-pandemic levels, there’s a lot of ground to cover.
In 2021, overall passenger numbers only reached 47% of 2019 levels. This influx was largely driven by domestic travel, with international passenger numbers only reaching 27% of pre-COVID levels.
|Passenger numbers (% of 2019)||2021||2022|
From a regional perspective, Central America experienced one of the fastest recoveries. In 2021, overall passenger numbers in the region had reached 72% of 2019 levels, and they are projected to reach 96% by the end of 2022.
In fact, the Americas as a whole has seen a quick recovery. Both North America and South America also reached above 50% of 2019 ridership in 2021, and are projected to reach 94% and 88% ridership in 2022, respectively.
On the opposite end of the spectrum, Asia Pacific has experienced the slowest recovery. This is likely due to stricter lockdowns and travel restrictions put into effect in this region (which was harder hit by SARS in 2003), especially in places like Shanghai.
Forecasting Traffic in 2023 and Beyond
While recovery has looked different from region to region, airlines are largely expected to see a full recovery to their ridership levels by 2025.
|Forecasted Passengers (% of 2019)||2023||2024||2025|
This recovery is a signifier of a much broader mindset shift, as governments continue to reassess their COVID-19 management strategies.
But while the future seems promising, IATA stressed that the forecast does not take into account the potential impact of the Russia-Ukraine conflict and other geopolitical concerns, which could have far-reaching consequences on the global economy (and travel) in the coming years.
All of the World’s Money and Markets in One Visualization (2022)
From the wealth held to billionaires to all debt in the global financial system, we look at the vast universe of money and markets in 2022.
All of the World’s Money and Markets in One Visualization
The era of easy money is now officially over.
For 15 years, policymakers have tried to stimulate the global economy through money creation, zero interest-rate policies, and more recently, aggressive COVID fiscal stimulus.
With capital at near-zero costs over this stretch, investors started to place more value on cash flows in the distant future. Assets inflated and balance sheets expanded, and money inevitably chased more speculative assets like NFTs, crypto, or unproven venture-backed startups.
But the free money party has since ended, after persistent inflation prompted the sudden reversal of many of these policies. And as Warren Buffett says, it’s only when the tide goes out do you get to see “who’s been swimming naked.”
Measuring Money and Markets in 2022
Every time we publish this visualization, our common unit of measurement is a two-dimensional box with a value of $100 billion.
Even though you need many of these to convey the assets on the balance sheet of the U.S. Federal Reserve, or the private wealth held by the world’s billionaires, it’s quite amazing to think what actually fits within this tiny building block of measurement:
Our little unit of measurement is enough to pay for the construction of the Nord Stream 2 pipeline, while also buying every team in the NHL and digging FTX out of its financial hole several times over.
Here’s an overview of all the items we have listed in this year’s visualization:
|SBF (Peak Net Worth)||$26 billion||Bloomberg||Now sits at <$1B|
|Pro Sports Teams||$340 billion||Forbes||Major pro teams in North America|
|Cryptocurrency||$760 billion||CoinMarketCap||Peaked at $2.8T in 2021|
|Ukraine GDP||$130 billion||World Bank||Comparable to GDP of Mississippi|
|Russia GDP||$1.8 trillion||World Bank||The world's 11th largest economy|
|Annual Military Spending||$2.1 trillion||SIPRI||2021 data|
|Physical currency||$8.0 trillion||BIS||2020 data|
|Gold||$11.5 trillion||World Gold Council||There are 205,238 tonnes of gold in existence|
|Billionaires||$12.7 trillion||Forbes||Sum of fortunes of all 2,668 billionaires|
|Central Bank Assets||$28.0 trillion||Trading Economics||Fed, BoJ, Bank of China, and Eurozone only|
|S&P 500||$36.0 trillion||Slickcharts||Nov 20, 2022|
|China GDP||$17.7 trillion||World Bank|
|U.S. GDP||$23.0 trillion||World Bank|
|Narrow Money Supply||$49.0 trillion||Trading Economics||Includes US, China, Euro Area, Japan only|
|Broad Money Supply||$82.7 trillion||Trading Economics||Includes US, China, Euro Area, Japan only|
|Global Equities||$95.9 trillion||WFE||Latest available 2022 data|
|Global Debt||$300.1 trillion||IIF||Q2 2022|
|Global Real Estate||$326.5 trillion||Savills||2020 data|
|Global Private Wealth||$463.6 trillion||Credit Suisse||2022 report|
|Derivatives (Market)||$12.4 trillion||BIS|
|Derivatives (Notional)||$600 trillion||BIS|
Has the Dust Settled Yet?
Through previous editions of our All the World’s Money and Markets visualization, we’ve created snapshots of the world’s assets and markets at different points in time.
For example, in our 2017 edition of this visualization, Apple’s market capitalization was only $807 billion, and all crypto assets combined for $173 billion. The global debt total was at $215 trillion.
|Asset||2017 edition||2022 edition||Change (%)|
|Apple market cap||$807 billion||$2.3 trillion||+185%|
|Crypto||$173 billion||$760 billion||+339%|
|Fed Balance Sheet||$4.5 trillion||$8.7 trillion||+93%|
|Stock Markets||$73 trillion||$95.9 trillion||+31%|
|Global Debt||$215 trillion||$300 trillion||+40%|
And in just five years, Apple nearly quadrupled in size (it peaked at $3 trillion in January 2022), and crypto also expanded into a multi-trillion dollar market until it was brought back to Earth through the 2022 crash and subsequent FTX implosion.
Meanwhile, global debt continues to accumulate—growing by $85 trillion in the five-year period.
With interest rates expected to continue to rise, companies making cost cuts, and policymakers reining in spending and borrowing, today is another unique snapshot in time.
Now that the easy money era is over, where do things go from here?
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