Shaping Tomorrow - Economic outlook

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Economic Outlook
A Future Prognosis
6 April 2020
Dennis Draeger, Shaping Tomorrow

Purpose
Help everyone anticipate and plan for tomorrow
Without an impartial strategic context there is a risk that
planners, policymakers and capability developers would
assume a future that supports their existing assumptions and
bias
We do not attempt to predict the future, but challenge your
thinking about shaping tomorrow and offer you tools to
navigate successfully
For every opportunity there are risks and for every risk there
are opportunities - please think both ways here2
2Shared under creative commons rules by Shaping Tomorrow

Introduction
Read on to discover what our robot, Athena, has found on the
future of this topic and act accordingly for you, your family and
organization in the years ahead. Make notes on issues that could
affect you and them as you go
If you are new to foresight, we recommend you view this slide
presentation first to get the best out of this report
Speed read Athena’s high-level take outs on the left of each slide,
or delve deeper into her findings on the right
Analysis
For a more detailed explanation of the graphics used in this
presentation please click here. All outlooks based on the time
period 2020-2070 and what’s likely to be happening in 2025 at a
95% confidence level unless otherwise stated. Please contact us
for longer-term outlooks
Shaping Tomorrow’s editor comments are presented in italics.
Speaker notes are also provided below every page to assist you in
interpreting the slides3
For interviews and queries
or help creating your
response, please contact us

Vantage Points
4
Slide
1. Front page
2. Purpose
3. Introduction
4. Slide index
5. Driving forces
6. Trends
7. Causes
8. Consequences
9. Solutions
10. System
11. Cloud
12. Geographies
13. Cities
14. Weak
15. Emerging
16. Maturing
17. Declining
18. Graph-It
19. Radar
20. Trend Waves
21. Pie Charts
22. Warnings
23. Bubbles
24. Inflections
25. Shocks
26. Influencers
27. Heat Map
28. VUCA
29. Sentiment
30. Challenges
31. Constraints
32. Dilemmas
33. Outcries
34. Extremes
35. PEST
36. Strengths
37. Weaknesses
38. Opportunities
39. Threats
40. Alternative Futures
41. Complexity
42. CLA
43. Scenarios
44. Three Horizons
45. Top Issues
46. Questions
47. NA
48. Potential responses
49. Sources
50. Evidence
51. Athena
52. Keep up to date

Driving Forces
5
Failure in climate change mitigation
could lead to greater human life and
economic losses during the coming
decades.
Carbon dioxide emissions could fall
by the largest amount since World
War Two this year as the coronavirus
outbreak brings economies to a
virtual standstill.
Main factors that cause something to happen globally

Trends
6
Pandemics lead to average annual
economic losses of 0.7 percent of
global GDP, or USD 570 billion,
similar to projected losses from
climate change in the coming
decades.
The population tidal wave predicted
to strike Africa and Asia in the
coming decades will completely
reshape the global economy.
Directions
See the trends in which your interest is developing or changing

Causes
7
Failing to mitigate climate change
would cause a 25% contraction in
the global economy, worse than the
Great Depression.
The World Economic Forum's (WEF)
Global Risks Report 2018 names
cyberattacks and cyber warfare as a
top cause of disruption in the next
five years.
Directions
Understand what's driving what

Consequences
8
28 million people could be pushed
into extreme poverty every year by
2050, with an overall cost to the
global economy of US$ 1 trillion per
year.
Nearly 70 million people could lose
their jobs to automation by 2030,
requiring a wholesale
reconfiguration of the world
economy.
Directions
Discover likely outcomes and effects

Solutions
9
Bold climate action could deliver at
least $26 trillion in net global
economic benefits between now
and 2030 compared with business-
as-usual.
Directions
Know how others are tackling issues with this topic

Map
10
System
In the next 10 years, the digital
transformation initiatives will
radically alter manufacturing, energy,
agriculture, transportation and other
industrial sectors of the economy,
which together, account for nearly
two-thirds of the global gross
domestic product.

Cloud
11
System
Growing opportunities and threats
revolve around these 5 topics:
business, education, economics,
construction and change. The most
trending topics are payments,
property and construction in the
years 2023, 2025 and 2040
respectively.
I recommend you visit me at
shapingtomorrow.com and search on
these topics for my further in-depth
analysis of their likely future impact.

12
Top 10 countries experiencing change are Eritrea, Mongolia, Romania,
Sierra Leone, Tajikistan, Zambia, Moldova, Taiwan, Micronesia and
Myanmar.
Geographies

13
Top 10 cities facing change are Abidjan, Liverpool, Osaka, London,
Manchester, Ho Chi Minh City, Beijing, Dallas, Las Vegas and Sheffield.Cities

Weak
14
The global economy will confront
serious challenges in the months
and years ahead, and looming in the
background is a mountain of debt
that makes markets nervous-and
that thus increases the system's
vulnerability to destabilizing shocks.
Cycles
Explore new discoveries, inventions and ideas

Emerging
15
The transition to 5G will transform
our lives, our economy, our jobs,
and our industries as evidence of
early signs emerges each day.
Emerging markets will start to
dominate rankings of the world's
top economies by 2030.
Cycles
Notice what’s becoming apparent or prominent

Maturing
16
Globally, the Space Economy is
expected to grow significantly, from
$360 billion in 2018 to $2,700 billion
in 2045, and will also see aerospace
technologies develop into
applications in all major sectors,
such as telecommunications,
agriculture, logistics and
meteorology.
Cycles Contemplate future development, growth and completion
By 2023, enterprises' ability to rapidly develop their own digital
innovations will be a core competitive requirement, as more than
half of the world-wide economy will be digitally driven.

Declining
17
Biodiversity loss was named as the
third biggest risk to the world in
terms of likelihood and severity this
year by the World Economic Forum,
ahead of terror attacks, infectious
diseases and interstate conflict.
As economies of scale are achieved
and costs of manufacturing batteries
decline, the price of EVs will fall.
More than half of all point-of-sale
transactions will be contactless by
2022.
Cycles
Explore what’s deteriorating, failing or collapsing

4 YEARS AGO NOW
Trend Waves
The top 5 topics 4 years ago were business, economics,
consumption, energy and computing. The most trending topics
were investment, climate and finance in the year 2031, 2031 and
2036 respectively. The direction of travel of this topic was
declining over the forecast years.
Currently the top 5 topics are economics, climate, business,
change and consumption. The most trending topics are
payments, property and construction in the year 2023, 2025 and
2040 respectively. The direction of travel of this topic is growing
over the forecast years. The curve is also more volatile than four
years ago.

Graph-It
19
Outlooks
The top five emerging forces that will
drive change in 2025 are seen by
experts to be construction,
collaboration, logistics, advice, and
robotics with AI increasingly
underpinning progress in these
topics.

Radar
20
Outlooks
The top five sectors that will be
experiencing significant change in
2025 will be mining (collapse),
construction, IT, retail and security.

Pie Charts
21
Outlooks
The start year was 2020, in line with the
sudden tipping point caused by the
coronavirus, and the average intensity
over the 2020-2060 time horizon is
medium with the end year currently
calculated as 2059. The tipping point is
when 33% accept the change as a new
paradigm, and is expected to occur in
2033. So we can expect major changes to
economic models, work, travel,
consumption, supply and demand over
the next decade though these are not yet
fully defined.
However, it’s likely more will work from
home, wear masks, fly less and be
temperature checked at every turn
among many future changes.
See our previous Coronavirus presentation for more likely changes
And contact us to set up your own private watch list of emerging
trends resulting from Covid-19

Warnings
22
Report indicated that extreme
weather events were the most likely
threat to disrupt the global
economy over the next decade,
representing a greater danger than
weapons of mass destruction, cyber-
attacks, or data fraud and theft.
The United Nations (UN) has warned
that the coronavirus outbreak could
cost the global economy $1 trillion
this year alone.
Signals
Take heed of alerts, cautions and forewarning

Bubbles
23
The global pandemic collapsed a
global economy inflated by $16
trillion in U.S. corporate debt alone,
much of it owed by zombie
companies in the fossil fuels
industry without hope of repaying
the debt enabled by ultra-low
Federal Reserve Bank interest rates.
Signals
Observe ballooning and disillusionment

Inflections
24
Getting to the net zero emissions
economy that governments around
the world have signed up to will
require radical transformation of
every sector of the economy.
Within the next decade, AI is going
to transform the global economy in
an exponential manner.
Signals
Give thought to potential turning points

Shocks
25
Decades of open borders, unceasing
intercontinental travel, study
abroad, just-in-time inventory
systems, and the like have created
unexpected vulnerabilities in
populations and economies thanks
to unfettered openness.
Signals
Eyeball potential surprises, wildcards, traumas
71 countries suffered net declines in political rights and civil
liberties in 2017 and by 2030, for the first time in our lifetimes,
the world's biggest economy will not be a democracy - or even
want to become one.

Influencers
26
Opinions
Amid the transition to sustainable
energy, Saudi Arabia and Russia are
fighting a trade war over oil prices that
will further destabilize the global
economy during the COVID-19 pandemic.
Economic uncertainty could dominate
2020 even if demand and consumption
skyrocket after the lockdown due to
constrained supply chains.

27
Key forces for sectoral change are coming from Aerospace & defence,
Telecoms, Construction, Energy and Environment, while countries leading
change include India, USA, Kenya, Myanmar and Nigeria.
Heatmap

VUCA
28
Currently VUCA is on a steep path
downwards indicating an emerging
recession is right in front of us and
growing uncertainty as a result of the
coronavirus and other economic
bubbles lurking in the background.
Please contact us to find out how be
agile and resilient in troubled times
and hugely successful when the
sunshines again.
How uncertain is the world?
VUCA is an acronym used by the American Military. It stands for Volatile, Uncertain, Complex and
Ambiguous
“Any manager can cut cost, but leaders chew gum and
walk on water as they simultaneously become more
efficient and grow their business, despite recessions.
They’ve got their weather eye firmly fixed on the future
while all around them only see what’s right in front, or
behind them.” Dr Mike Jackson, Shaping Tomorrow - September
1990

29
The top 5 positive sentiments are business, finance, economics,
consumption and wealth. While the top 5 negative sentiments are
construction, change, illness, economics and energy.
Sentiment
{{40-image}}
Mj to create

30
Food and agriculture has
flown to the front of the
challenge pack in the past
week over coronavirus
concerns around growing
demand, stockpiling and
loss of earnings during
country lockdowns.
Challenges

Constraints
31
Some 500 million people live in
countries at risk of instability and
conflict. The economic impact of
containing and dealing with the
consequences of global violence has
been estimated at close to 10 trillion
US dollars.
Risk factors are interacting and
multiplying as geopolitical and
regulatory uncertainties accompany
fresh fractures in the institutional
foundations of our global economy.
Limits
Reflect on what is restricted, compelled or avoided
Without a doubt, our inability to transform our economic
systems into models compatible with planetary boundaries will
define the beginning of the 21st century.

Given the weakening global economy,
airlines may face an overcapacity
problem later this year, which could
weigh on aircraft demand in the
medium term with major economic
consequences.
While a sudden boom in pent-up
demand might ensue as lockdowns are
lifted the public may be fearful of
crowds, particularly in airports, train
stations and supermarkets and seek
alternative arrangements.
Dilemmas
32
Limits
Consider situations involving difficult choices

Outcries
33
The economic turmoil has sparked
fears of a global recession, with
Bloomberg analysts warning that
the global economy could lose up to
$2.7 trillion.
The outlook across most of the
world is sluggish economic growth
that will raise wages and improve
living standards only slowly over the
longer term-and will leave festering
discontent among the many who are
falling behind in a slow-growing
world economy.
Limits
Understand what's testing people's patience

Extremes
34
Humans are living longer and
economic inequality (low-pay,
increased employment competition,
limited access to health care,
minimal retirement savings, etc.)
will strain our global economy.
28 million people could be pushed
into extreme poverty every year by
2050, with an overall cost to the
global economy of US$ 1 trillion per
year.
Limits
Investigate what’s deteriorating, failing or collapsing
Extreme weather is once again named as the most pressing
threat facing the global economy in 2019.

PEST
Political:
economy; brexit; policy; GDP; country;
growth
Economic:
economy; market; growth; GDP; car;
consumer
Social:
health; infrastructure; security;
innovation; people; reform
Technological:
data; artificial intelligence; digital;
internet of things; app; automation
35
Describes a framework of macro-environmental factors used
in the environmental scanning component of strategic
management
Contact us to understand how to use these analyses to create
your own agile and robust strategic response from this page to
page 45

Strengths
36
Thirty years from now, the global labor
force will look very different, as working
age populations in many countries,
especially in advanced economies, start
to shrink.
SWOT
Positive attributes that enhance performance

Weaknesses
37
The World Economic Forum's (WEF)
Global Risks Report 2018 names
cyberattacks and cyber warfare as a top
cause of disruption in the next five
years.
SWOT
Negative factors that detract from strengths

Opportunities
38
The global GDP will be 14 percent higher
by 2030 as a result of AI adoption,
contributing an additional $15.7 trillion
to the global economy.
SWOT
Factors that are likely to contribute to your success

Threats
39
If the economic factors are being
focused upon, the environmental ones
need more attention as EV batteries are
expected to pose a threat to the
environment within a decade owing to
their short life.
SWOT
Factors that you have no control over

Alternative
Futures
Entrepreneurs, Leaders and Activists
will change existing paradigms in
profound ways, some businesses will
collapse, and myths and existing
paradigms will be exploded towards
very different futures. To remain
agile and resilient in this VUCA,
world organizations need to
determine their path forward
through futures programs that give
them an entrepreneurial, social and
leadership edge.
40
Foresight Methods
Taking different viewpoints
Shared under creative commons rules by Shaping Tomorrow VUCA is an acronym used by the American Military. It stands for Volatile, Uncertain, Complex and
Methods

Complexity
Obvious:
market; growth; GDP; demand;
economy; artificial intelligence
Complicated:
company; economy; election; demand;
bank; competition
Complex:
5G; connected; internet of things; cost;
bank; GDP
Chaotic:
economy; GDP; brexit; growth; demand;
recession
41
Lead facilitator
Dr Mike Jackson
Helps managers to identify how they perceive situations and
make sense of their own and other people's behaviour
Methods

CLA
Litany:
economy; growth; emission; market;
GDP; bank
System:
economy; growth; market; GDP;
demand; oil
Worldview:
economy; car; bank; 5G; consumer;
artificial intelligence
Myth:
economy; debt; job; bank; GDP;
automation
42
Lead facilitator
Professor Sohail Inayatullah
Causal Layered Analysis identifies four levels of causality to
more effectively shape transformative futures
Methods

Discipline:
economy; market; growth; GDP;
emission; bank
Grow:
economy; growth; market; GDP;
demand; oil
Transform:
economy; car; bank; 5G; consumer;
battery
Collapse:
economy; debt; job; bank; GDP;
automation
43
Scenarios
Lead facilitator
Alessandro Fergnani
Creates plausible alternative futures of what can happen
and encourages development of a robust, agile response
Methods

Managerial:
market; economy; growth; production;
oil; GDP
Leadership:
economy; influence; 5G; customer;
satellite; bank
Entrepreneurial:
economy; car; job; consumer; battery;
5G
44
Three Horizons
Lead facilitator
Patricia Lustig
Encourages further and wider debate about the facilitation
of transformative change from one level to another
Methods

Banks
Oil
5G
Consumers
Jobs
ARE YOU PREPARED?
Contact us to develop alternative futures that help you remain resilient
and agile into the future.
Our participative, digital methods can deliver robust results in hours
rather than the months and years of effort required by traditional
consultancy.
Summary viewpoints
Top Issues*
Shared under creative commons rules by Shaping Tomorrow 45
Methods
* Top issues exclude Market, Growth, GDP, Economy

Questions for you to
consider
Take at least a medium term, not a short-term view when considering these questions
46
What are the best ways to make your retirement
recession-proof and avoid the losses many people
suffered during the last major economic downturn?
China set to break key economic barrier despite
trade war, but can it avoid the middle income trap?
Is there need for more aggressive policy measures to
turn China's economy around?
Is environmental and social responsibility a fad, or
will it have long-lasting effects on the global
economy?
“People usually overestimate the change that will occur in the next
two years and underestimate the change that will occur in the next
ten.” - Bill Gates

Potential Responses
Use the findings of this Alert
to determine and rank your options and
choose how you can respond by
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Sources
48
Athena used the top sources shown
here as the ones to create this
report and determine which
embedded forecasts are included in
this Trend Alert. She found 22,734
forecasts in seconds on 6 April 2020
to allow us to automatically build
and publish this report in less than
the time it takes to get and drink a
coffee.

Evidence
Search term econom*. Use this
search term to explore Shaping
Tomorrow’s extensive
database for more knowledge
and wisdom and latest data
and information on the topic.
49
Latest Forecasts

Athena
50
I do show duplicates to aid your
understanding of themes as well as
contradictory forecasts. I may also show
near-duplicates. You can speed read past
the duplicates and near-duplicates if you
wish, though the latter may show
additional information.
You can use the contradictory, and likely
uncertain forecasts she finds to imagine
different scenarios. The future is
unpredictable, but we can examine the
possibilities and choose our preferable
future from the choices I present.
I’m apolitical. I report forecasts from
different viewpoints however distasteful
that might be to our own values.
However, my news algorithm does not
allow me to show fake or hate news. But,
i can show you highlighted rumours or
controversies that may turn out to come
true.
Wearing rose-colored glasses is not
my purpose; reporting potential
futures is. So, I recommend you check
my veracity before responding to the
extracted forecasts.
Just like humans, I can be fallible. Do
recognize that you and your associates
are biased too. But whereas you tire,
make mistakes and only recognize
what interests you, I do not. I might
miss or misinterpret as you do, but
with far less frequency and I'll take
uncomfortable truths and alternative
ideas in my stride. But, please let us
know if you feel my bias can be
reduced.
We want to do our best for you. And,
as with any research, you should check
and triangulate my findings for
yourself.
Contact us if you would like some free training with these methods

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51
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The Shaping Tomorrow Team

Shaping Tomorrow - Economic outlook

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