Business executives, politicians and academics are bracing for a gloomy world battered by intersecting crises, as rising volatility and depleted resilience boost the odds of painful simultaneous shocks.
In its annual survey of risks published Wednesday, the World Economic Forum found that more than 80% of respondents expected either "persistent crises" or "multiple shocks" over the next two years, at best leading to "divergent trajectories" for countries and at worst triggering "catastrophic outcomes."
Global experts identified the cost-of-living crisis as the most severe short-term risk, as high prices for necessities like food slam vulnerable households and lift the odds of civil unrest and protests.
"No country is immune to social erosion caused by lack of affordability and availability of basic necessities," said Carolina Klint, risk management leader for continental Europe at Marsh McLennan, which partnered with WEF on the report.
Natural disasters and extreme weather events are seen as the next greatest risk, followed by economic warfare, failure to mitigate climate change and the polarization of society.
Environmental concerns dominate over a 10-year time horizon. The top five long-term risks were identified as failure to mitigate climate change, failure to adapt to climate change, natural disasters and extreme weather events, biodiversity loss and ecosystem collapse and massive refugee crises.
This reflects the message from the United Nations at its recent climate summit, which warned that nations are still way off track to limit global warming below the crucial threshold of 1.5 degrees Celsius, said John Scott, head of sustainability risk at Zurich Insurance Group, another WEF partner.
"It feels like we're heading toward a much slower and more disorderly climate transition," Scott said, noting that Russia's war in Ukraine has pushed leaders to prioritize access to fossil fuels at the expense of "what's scientifically necessary."
The survey, which comes ahead of the World Economic Forum's glitzy annual meeting in Davos, Switzerland, next week, is based on responses from more than 1,200 experts in fields such as academia, business, government and civil society.
Klint said businesses are starting to spend more to guard against interconnected, compounding risks that could prove costly down the line. But forecasting in the era of the "polycrisis" is a difficult exercise.
The World Economic Forum's 2022 survey put "interstate conflict" near the bottom of a list of risks that had worsened since the start of the pandemic. Weeks later, Russia launched its full-scale invasion of Ukraine.