Growing threat of extreme weather, ecosystem degradation, and climate change could cause 'runaway collapse' in complex global systems, experts fear
The environment has once again ranked as the most pressing global risk in the annual Global Risks Perception Survey (GRPS) from the World Economic Forum, underlining the concern felt by economic experts at the rapid rate of change in the natural world.
As in 2017, the 2018 GPRS saw all five environmental risk factors - extreme weather, biodiversity loss and ecosystem collapse, major natural disasters, man-made environmental disasters, and the failure of climate change mitigation and adaption - ranked highly, both in terms of their likelihood and impact over a 10-year horizon.
The annual survey, which was published ahead of next week's Davos Summit, questioned nearly 1,000 risk managements experts about the threats facing the planet in 2018.
Out of 30 risks, extreme weather was singled out as the single most prominent threat facing the world in terms of likelihood. It was followed by natural disasters, cyberattacks, data fraud or theft, and failure of climate change mitigation and adaption.
"Extreme weather events were ranked again as a top global risk by likelihood and impact," Alison Martin, group chief risk officer at Zurich Insurance Group, warned. "Environmental risks, together with a growing vulnerability to other risks, are now seriously threatening the foundation of most of our commons. Unfortunately we currently observe a 'too-little-too-late' response by governments and organisations to key trends such as climate change."
Meanwhile, the majority of experts surveyed reported a heightening of all risks this year, with 59 per cent pointing to an intensification of risks, compared to just seven per cent reporting declining risks.
Part of the rising concern over global risks is due to the growing complexity and interconnectedness of our global systems, the WEF said, where "sudden and dramatic breakdowns - future shocks - become more likely". Such "future shocks" could include the simultaneous collapse of food supply chains around the world, or AI-piloted drone ships decimating global fish populations.
"When risk cascades through a complex system, the danger is not of incremental damage but of 'runaway collapse' or an abrupt transition to a new, suboptimal status quo," the WEF warned.
Alongside the pressing dangers of changes to the world's climate and natural systems, risk experts also reported a surge in geopolitical concerns, with 93 per cent saying they expect political or economic confrontations between major powers to worsen and almost 80 per cent expecting an increase in risk associated with war between global powers.
"This is perhaps the first generation to take the world to the brink of a systems breakdown," WEF founder and chairman Professor Klaus Schwab said in the report's preface. "There are many signs of progress and many reasons for hope - but we still lack the momentum and the necessary depth of collaboration to deliver change on the scale required."
The news follows a year in which environmental disasters have dominated global headlines. Hurricanes Harvey, Irma, and Maria caused widespread destruction across the US and Caribbean, while huge floods devastated large parts of India and Africa. As a result, 2017 is likely to be the most expensive year on record for insurers.
However, experts argued the relative strength of the global economy - economic risks featured less prominently in this year's survey compared to previous years - offers world leaders a "golden opportunity" to focus on tackling the systemic and environmental risks the world faces.
"A widening economic recovery presents us with an opportunity that we cannot afford to squander, to tackle the fractures that we have allowed to weaken the world's institutions, societies and environment," Schwab said in a statement. "We must take seriously the risk of a global systems breakdown. Together we have the resources and the new scientific and technological knowledge to prevent this. Above all, the challenge is to find the will and momentum to work together for a shared future."
Today's report underscores the extent to which environmental risks have shot up the mainstream agenda in the last decade. The first GRPS report in 2008 ranked asset price collapse as the most pressing threat for the world economy, with environmental risks failing to feature at all in the top five. Now environmental issues dominate the global risk agenda.
But the rising concern over environmental dangers is a double-edged sword. It not only reflects the acceptance of climate risks in mainstream discussion, but the ever-increasing threat it poses as time runs out to tackle the problem before hopes of limiting temperature increases to well below 2C disappear.
"It's not yet too late to shape a more resilient tomorrow, but we need to act with a stronger sense of urgency in order to avoid potential system collapse," Zurich Insurance Group's Martin urged.
With a planet apparently "on the brink" of ecological, humanitarian and economic disaster - and evidence mounting that dangerous levels of climate change will accelerate this century unless urgent action is taken - let us hope the leaders at Davos and beyond are listening.
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