Introduction from Jonathan Birdwell, global head of policy & insights, Economist Impact

For the year ahead, uncertainty is the only certainty. The fate of the world rests on the risks of escalating conflicts and the outcome of electoral contests—more than half the world’s population will hold elections in 2024. War and shifting alliances will continue to reshape geopolitical order. Extreme weather events will challenge businesses and governments and draw attention to how far we are from emissions targets. Advanced technologies offer a glimmer of hope and competitive advantage, but also carry significant—some say existential—risk.

In this special blog, our experts explore the critical trends that will shape the world.   Discover analysis of what to expect across our three areas of leadership—new globalisation, sustainability and health—to enable you to navigate the complexities of these challenging and transformative times.

NEW GLOBALISATION
John Ferguson, global head, new globalisation, policy & insights at Economist Impact

The global economy has entered a new chapter of globalisation. That will become even more evident in 2024. Global trade will remain in transition as supply chains shift worldwide. Diversification and regionalisation will drive these shifts, with countries such as  Vietnam and Mexico likely to benefit. Geopolitics, now central to globalisation, poses a significant threat to the global economy. Policymakers and business leaders must maximise efforts to avoid geopolitics leading to economic fragmentation in 2024, where almost all stakeholders will lose. According to estimates from our latest Trade in Transition research launching this week, fragmentation could result in almost 1% of global GDP lost, if it’s not contained. 

Generative AI offers a possible bright spot in 2024. While policymakers rush to regulate the latest wave of AI, business leaders are optimistic and are experimenting with the technology. These efforts will lead to greater efficiencies in business operations and improved resilience, such as identifying risks, fraud and other security concerns. It is  also a significant year for democracy, with elections in major economies. There are concerns about the impact of generative AI on these elections, with disinformation a genuine worry. But if efforts can be made to tackle these aspects of AI, the outlook for 2024 may be one of cautious optimism. 

SUSTAINABILITY
Phillip Cornell, global practice lead for energy & sustainability at Economist impact

Together with geopolitics and technology shifts, the imperative to transition economies and business models to a more sustainable footing will continue to drive corporate and policy decision-making in 2024.

Corporates are contending with the realities of implementation to meet ambitious goals for decarbonization and net zero set over the past few years. Last year saw pull-back in the energy sector, where some oil majors realigned their strategies and green policies came under pressure. A string of contentious elections in 2024 will give voters an opportunity to weigh in on the costs and benefits of green ambitions.

But companies will still need to contend with ongoing changes to the climate disclosure landscape. This includes new rules from the SEC expected in the spring, new European CSRD mandates coming into force and ongoing consolidation under the auspices of the ISSB. Data will be key, especially as companies need to start reporting on emissions embedded in their products to prepare for carbon border adjustments in coming years.

COP28 closed in Dubai with a commitment to move away from fossil fuels use, which will require a drastic acceleration of low-carbon alternatives. Money from the Inflation Reduction Act (IRA) will start to really flow in 2024 as grant programmes begin distributing ear-marked money, and in emerging markets, development banks will accelerate climate financing to catalyse private investment. High interest rates will continue to pose headwinds for renewable energy projects, such as offshore wind, and oil and gas markets will remain focused on the demand outlook.

Biodiversity and the move to "nature positive" business is also likely to play an increasing role in 2024. Biodiversity COP16 in October will focus policy minds, but as companies come to terms with the realities of assessing and protecting natural capital, new funds and financial instruments will help to mobilise the necessary financing.

HEALTH
David Humphreys, Global Head, Health, Policy & Insights at Economist Impact

For health, 2024 will be a critical juncture for translating lessons learned and stated priorities into action, building upon past momentum towards holistic, equitable wellbeing. The ever-expanding health ecosystem—big tech, investors, employers, academics, entrepreneurs, non-health policymakers—will all continue to buoy efforts from legacy healthcare actors to bring real-world innovations to market and foster new ways of thinking.

As part of that ecosystem expansion, all things digital will likely capture both headlines and traction across a spectrum of healthcare activities. Though regulations will find it difficult to keep up with the pace of change, the growing maturity of systems and familiarity of practitioners and users alike will further propel the use of digital tools—whether that be virtual care or AI in health decision-making.

At the same time, preparation for future challenges will undoubtedly remain a key theme for the year ahead. The drive towards a comprehensive pandemic treaty and the high level UN meeting on anti-microbial resistances (AMR) are examples of much needed efforts to tackle real risks. However, there will be  significant headwinds as stakeholders attempt to leave entrenched positions behind and forge new models of collaboration;and ultimately shared accountability.

Climate change will be at the forefront of dialogue around future risks. COP28 helped elevate the sector's voice on the wide-ranging impact this has on human health and the need for fully integrated responses. Though that voice and supporting evidence will become stronger, it will be vital to see progress towards real adaptation—with critical infrastructure, sustainable health systems and related societal foundations—to help communities cope with an increased likelihood of natural disasters and an array of health implications. 

Throughout 2024, Economist Impact will be using insights from our research to help business leaders and policymakers navigate future challenges and opportunities . First up, in January, we will be publishing the latest edition of our Trade in Transition programme, which analyses how globalisation is changing in the face of geopolitical and economic uncertainty. This is based on a global survey of 3,000 business leaders, and using our latest economic models to estimate what the impact will be as a result. We will also be publishing two reports on the important topic of green skills—exploring what they are, why they are critical for a just transition and how failure to address them could undermine global efforts to reach net zero.

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