Reflecting mounting concern about the risk to societies from inequality, the WEF said the need to tackle disparities in income and wealth had to be addressed at WEF's annual gathering in the Swiss ski resort of Davos next week.
The WEF said its annual survey of 700 opinion formers had identified the income gap, extreme weather events and unemployment or underemployment as the three threats most likely to cause major cross-border damage in the next 10 years.
It added that a fresh fiscal crisis, climate change and water shortages were the three risks that would have the biggest impact on the global community but these were seen as less likely.
Jennifer Blanke, the WEF's chief economist, said that while incomes gap between countries had been closing, the gulf between rich and poor had been widening within countries. "The message from the Arab spring, and from countries such as Brazil and South Africa is that people are not going to stand for it any more."
The Davos meeting has often been targeted by anti-globalisation campaigners as an exclusive club for a small, powerful elite but Adrian Monck, the WEF's head of communications, said inequality and the wealth gap was on the agenda. "We need to mobilise people around these issues and make people aware of them", he said.
The report also highlighted the problems of "generation lost" and said that the world's increasing reliance on the internet had resulted in a threat of "cybergeddon".
The study, Global Risks 2014, said the generation coming of age in the 2010s faced high unemployment and job insecurity, hindering their efforts to build a future and raising the risk of social unrest.
Noting that many young people faced an uphill battle, David Cole, group chief risk officer of Swiss Re, one of the companies responsible for putting together the report, said: "The members of generation lost are not lost because they have tuned out. They are highly tuned in. They are lost because they are being left out or they are deciding to leave."
He added: "As a result of the financial crisis and globalisation, the younger generation in the mature markets struggle with ever fewer job opportunities and the need to support an ageing population. While in the emerging markets there are more jobs to be had, the workforce does not yet possess the broad-based skill sets necessary to satisfy demand."
The WEF said the massive expansion of the internet made the risk of systemic failure greater than ever, but recent revelations about government surveillance had reduced the global community's willingness to work together to address potential weaknesses. It added that the effect could be a "Balkanisation" of the internet, or so-called cybergeddon, where hackers enjoy overwhelming superiority and massive disruption is commonplace.
Axel Lehman, chief risk officer at Zurich Insurance Group said: "Trust in the internet was decreasing as a result of data misuse, hacking and privacy intrusion. A fragmentation of the internet is the wrong way to solve this issue, as it would destroy the benefits the web provides to all of us. Rather than building walled gardens, it is time to act by setting up security standards and regaining trust."(source guardian.uk)
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Europe’s single currency is fuelling inequality, and the loss of sovereignty entailed in eurozone membership has led to “increased unemployment and social hardship” in many countries, a European Commission report has revealed.
The 496-page report, “Employment and social developments in Europe 2013”, warns that deepening economic divisions between North and South, rich and poor eurozone countries threaten to undermine the European Union itself.
The stark findings, published by Laszlo Andor, the EU’s social affairs commissioner, acknowledges that the loss of sovereignty involved in giving up national currencies has led to a loss of flexibility in tackling the economic crisis.
With the loss of the ability to devalue national currencies to increase competitiveness, eurozone members have been forced to drive down living standards to a degree that is historically unprecedented since the 1930s - Greece has seen incomes collapse by more than 30pc.
“In the absence of the currency devaluation option, euro area countries attempting to regain cost competitiveness have to rely on internal devaluation (wage and price containment),” the report concluded.
The global economic recovery will pick up pace this year but remains "weak and uneven", the International Monetary Fund's top economist has said.
Olivier Blanchard said the "largely anticipated" recovery in global growth would see it pick up to 3.7% in 2014 from 3% last year but there was still much work to be done as new risks emerged.
In a boost to George Osborne, Blanchard confirmed the IMF had raised its UK growth forecast to 2.4% for this year, from a previous forecast of 1.9%. It was Blanchard, who last year warned Osborne has was playing with fire with his austerity drive, but the forecast for the UK is well ahead of Europe's largest economy, Germany, where growth is forecast at 1.6%. France's economy would grow by a much weaker 0.9% given "policy uncertainty is weighing on growth", Blanchard said.
The forecast for global growth was barely changed from 3.6% pencilled in last October when the IMF published its closely watched World Economic Outlook (WEO).
"The brakes to the recovery are progressively being loosened. The drag from fiscal consolidation is diminishing. The financial system is slowly healing. Uncertainty is decreasing," said Blanchard, unveiling the fund's latest update to the WEO forecasts.
The Washington-based fund also stuck by its view that growth in advanced economies would accelerate markedly this year, to 2.2% from 1.3% in 2013. Growth in emerging market and developing economies will edge up to 5.1% from 4.7% in 2013, Blanchard said.
He highlighted risks from deflation in the eurozone and the unwinding of years of ultra-loose monetary policy and stressed the recovery was fragile and by no means equally spread.
Those of us criticising and doubting the core validity of the Euro Project, as EMU became the fevered ideological Rubicon of idiot Euro politicians, could have told these morons the how and why this spavined experiment was doomed to utter abject failure many years ago.
SNAKE: Failed: SUPER SNAKE (Snake II) Failed. ERM: sort of failed.
Problem was - as always - the political animal is high on vision and low on analytical intellect.........
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