Monday, 28th July 2014

World economic predictions from Klaus Schwab for 2011: With a UK outlook

money-1.jpgCommercial feature - The World Economic Forum that is held in Davos, Switzerland, in January of each year not only analyzes the past year’s economic performance but also makes projections for the year to come.

Klaus Schwab, founder and chairman of Davos and referred to as “Davos Man”, has already spoken out on what he sees in the year to come. In his view, the forces of uncontrolled capitalism have created a world situation in which the gap between the very rich and the poor is at its widest ever, and the Mlllenials (children born after 2000) will lead the new economic realities. The world’s economic welfare is, in his view, resting upon new ways of doing business and new ways of solving international problems from a “togetherness” and “stakeholder” perspective, not a purely profiteering perspective. With this said, the predictions for 2011 include currency valuation volatility, increased demand on global natural resources,

The most pointed comments from Mr. Schwab refer to the world as a unit, and to the need to revise our ideologies to make the global community more equitable and inventive. His view includes a recognition of new values, new principles, and greater efforts to monitor climate and geographical changes. Schwab has stated that : “One new reality is global interconnectivity …. we should not look to old-world recipes since unfettered capitalism and state-directed collectivism have both been bankrupted as guiding ideologies….. Our only way out is the stakeholder concept. This means that the pursuit of our own interests can only be substantially realized by incorporating the interests of all those with whom we have a mutually dependent relationship. This is true on all levels, and in any capacity in which we take decisions: family life, society, business or politics.”

This view is supported by the formation of a Risk Response Network formed among the participants in the Davos summit, and by recent projections of economic conditions in the UK in the year 2011. Among these projections are the continuing decrease in real estate prices, greater levels of unemployment, and an ongoing need to address the soundness of larger banks and financial organizations. The growing unrest among the citizenry is expected to bring demands and responsive social welfare programs to enable survival through the difficulties. On the positive side, the pressures of joblessness will stimulate many to form new businesses to take the place of lost jobs, and it is hoped that many of these new enterprises will in fact provide new answers, inventions, and strategies for addressing the dilemmas now of top priority.