Global megatrends that are set to define this generation and the next
Key megatrends shaping the future include state efficiency, rising inequality, moral decline, climate failure, geopolitical tensions, and global instability.
With the world witnessing cascading strategic turbulence, it is sometimes easy to miss the important megatrends playing out. Here is an attempt to list the most important megatrends which will have a lasting impact on our lives in this century and the next.
One, the State will play an inordinately crucial role in determining whether countries succeed or not. Only those countries which have an efficient State, which is uncontested and which creates an enabling policy environment, have a bright future. Countries which have an inefficient, corrupt and contested State are at a severe disadvantage in today’s world characterised by resilient supply chains and strong regulation of critical minerals, Artificial Intelligence and quantum computing.
This year’s Nobel Prize for economics has gone to Daron Acemoglu and James Robinson who presciently wrote a book entitled, Why Nations Fail. Their thesis is simple yet powerful. It is the quality of institutions in a country that are decisive. Emerging countries need to take note and assess the quality of the judiciary, bureaucracy, central bank etc that they have and take proper remedial measures.
Two, the world is becoming more and more unequal. Today, 71% of the world’s population lives in countries where inequality is rampant. The average income of people living in North America is 16 times higher than that of people living in sub-Saharan Africa. This degree of inequality is not just unsustainable; it is actually a recipe for economic and social strife.
Three, nations appear to have lost their moral compass. Forget individuals, even nations have started blurring the distinction between right and wrong. There was hitherto general conviction that the arc of the moral universe may be long, but it eventually bends toward justice. That seems no longer to be true. Witness the war in Ukraine, the conflict in Gaza and the forgotten conflicts in sub-Saharan Africa.
Four, the world has all but lost the battle against climate change. Any hope that global warming in the world can be restricted to less than two degrees Celsius, compared to pre-industrial times, stands completely dashed. Worse still, there is still no credible attempt by the rich countries to raise climate finance for less developed countries or to widely disseminate green technology to combat climate change.
Five, there is a raging geopolitical battle between the United States of America and China for the mantle of the superpower in the 21st and 22nd century. But the irony is the outcome of this battle may be decided by geoeconomics. So, industrial policy is back in vogue and states such as the US, China or even the European Union are planning to spend billions of dollars on subsidies to state-owned and private enterprises to ensure their competitiveness and dominance in critical and emerging technologies of tomorrow. China’s re-emphasis on state owned enterprises, America’s Inflation Reduction Act and the European Union’s Carbon Border Adjustment Mechanism (CBAM) are all evidence of geoeconomics. Unfortunately, all of this puts the developing and least developed countries at a severe disadvantage.
Six, just as individuals have become self-centred and selfish, so have nations. The motto seems to be every country for itself. With global solidarity virtually non-existent, it is small wonder that multilateral cooperation is at a discount.
Seven, the Sustainable Development Goals (SDGs) launched with much fanfare by the United Nations in 2015 with clear targets to be achieved by 2030 lie in tatters. The UN secretary general has stated bluntly that only a meagre 17% of the SDG targets are on track. He has added that in a world of unprecedented wealth, knowledge and technologies, the denial of basic needs for so many is outrageous and inexcusable. Simply put, SDGs will not be achieved, even partially, by 2030.
Eight, since the post World War II period, this is arguably the first time that there is no global hegemon on the scene to orchestrate global affairs. The US lost that title when the unipolar moment ended abruptly around 2008. Since then, what we are seeing is a jostling for power and influence, primarily between the US and China on the one hand, but also other middle powers such as Japan, India, Brazil, ASEAN, Australia etc getting into the act on the other. This makes for a messy multipolar world which is crying out for some commonly agreed rules of the road. However, there are reasons to believe this messy multipolar world will endure for a while.
Nine, the global population is either expected to decline or remain stable through the period from now to 2100. The only exception is Africa which is estimated to grow from the present population of 1.3 billion to a whopping 4.3 billion by 2100. This has enormous implications for issues such as governance, immigration, food security and of course, poverty.
Ten, the advent of Artificial Intelligence could be a game changer. But like all inventions it could impact the man in the street either positively or negatively. Hence the need for State regulation on the subject.
And finally, the world is seeing a return to total war. Incessant, multi-theatre war appears to be a painful reality. While the major wars rage in West Asia and Ukraine, there are forgotten conflicts in Sudan, Myanmar, Yemen and Haiti, to name a few. According to the Peace Research Institute Oslo (PRIO), the number of state-based conflicts in 2023 was the highest since 1946. The West Asia and North Africa regions have more than 45 armed conflicts. Indeed, the past three years have been the most violent the world has ever been in the last three decades.
Taken together, the above megatrends have the effect of making our world unpredictable, unaccountable, unsustainable and unequal. For statesmen and policymakers, the challenge cannot be tougher.
Dr Mohan Kumar is a former Indian ambassador to France and currently dean/professor at O.P. Jindal Global University. The views expressed are personal.