by Caroline Gathii
“The world cannot wait for the fog of geopolitical and geo-economic uncertainty to lift. Opting to ride out the current period in the hope that the global system will “snap back” runs the risk of missing crucial windows to address pressing challenges. On key issues such as the economy, the environment, technology, and public health, stakeholders must find ways to act quickly and with purpose within an unsettled global landscape.”
This is the context in which the World Economic Forum publishes the 15th edition of the Global Risks Report 2020. It “comes as long-mounting, interconnected risks are being felt” and will greatly shape the coming decade. It categorizes risks into four areas namely Economic, Environmental, Geopolitical, Societal, and Technological. The risks are measured through the lens of likelihood and impact. It lists the top five risks in terms of likelihood as extreme weather, climate action failure, natural disasters, biodiversity loss, and human-made environmental disasters. This means that it is very likely that these risks, will affect the world in 2020 and the coming decade.
The report has also listed the top five risks in terms of impact as Climate action failure, weapons of mass destruction, biodiversity loss, extreme weather, and water crisis. Impact means that when these risks occur then they would pose a big threat in the world.
The highest risk under likelihood is extreme weather and its impact in all the five continents has invariably been felt. One will of course be foolhardy to ignore the other indicators—“climate action failure, natural disasters, biodiversity loss, and human-made environmental disasters,”— but there is no doubt that extreme weather will be a factor to keenly watch in Kenya and across Africa. Policymakers in Kenya and across Africa should be worried about extreme weather patterns as the report notes, “the last five years are on track to be the warmest on record and natural disasters are becoming more intense and more frequent, and last year witnessed unprecedented extreme weather throughout the world”.
In Africa, we experienced Cyclone Kenneth in Mozambique in April 2019, which killed several people and made several parts inhabitable. The Global Risks Report is the result of a multi-stakeholder process and it seems to echo what is being said in several other quarters.
In a related report, by CARE International titled, Suffering in Silence that echoes the Global Risks Report and cautions on the dangers ahead “Kenya has been facing droughts in recent years, with the most severe hitting the country in 2016/17. Scientists found that the probability of such a drought has doubled because of human-made climate change rising sea-surface temperatures. In 2019, rainfall was at least 20% below average, leading to a prolonged drought and adding to consecutive failed harvesting seasons that destroyed livelihoods and diminished the ability of communities to cope. In western Kenya, the long rainy season has been the driest on record. This directly affects the nutrition situation in the country, which remains alarming. More than 1.1 million people live without regular access to food and more than 500,000 children under five are in need of treatment for malnutrition. Continuing dry conditions across Kenya have led to the deterioration of livestock and crop productivity, higher food prices, and a decrease in water. Agricultural production has halved according to estimates. When there is not too little rainfall, there is far too much: heavy rains displaced tens of thousands of people during the fall months and destroyed farmland and livestock. This worsened an already dire food situation in the country.”
The CARE report adds that the agriculture production has halved, the Kenyan Economy is highly dependent on this sector that is equally dependant on the weather. In Kenya, agriculture contributes approximately 35% of the Gross Domestic Product (GDP) and constitutes 40% of the export earnings. The risk of extreme weather has a direct impact on the Kenyan economy. It means that if this sector is being halved then our GDP and our export earnings will be affected by a significant margin. The population who depend on the sector will have no or little capacity to earn a living, the lending institutions particularly the SACCOs, Micro-Finance Institutions that depend on this sector will have fewer membership subscriptions, payments, and defaults of already provided facilities. The balance of trade between Kenya and other countries where Kenya exports to like Europe will be severely impacted to the disadvantage of Kenya.
The Global Risks Report also points that alongside the issues of extreme weather, “the health systems around the world are at risk of becoming unfit for purpose. New vulnerabilities resulting from changing societal, environmental, demographic, and technological patterns threaten to undo the dramatic gains in wellness and prosperity that health systems have supported over the last century. Non-communicable diseases such as cardiovascular diseases and mental illness have replaced infectious diseases as the leading cause of death, while increases in longevity and the economic and societal costs of managing chronic diseases have put healthcare systems in many countries under stress. Progress against pandemics is also being undermined by vaccine hesitancy and drug resistance, making it increasingly difficult to land the final blow against some of humanity’s biggest killers. As existing health risks resurge and new ones emerge as seen by the Coronavirus saga, humanity’s past successes in overcoming health challenges are no guarantee of future results.
The Global Risks Report 2020 was part of an expanded Global Risks Initiative launched by the World Economic Forum in 2019 that included sustained analysis at the global, regional, and industry levels. The 2020 Report is a qualitative and quantitative study of global risks, conducted in partnership with members of the business, academic and public-sector communities, which organisers hope will help bring stakeholders together in developing sustainable, integrated solutions to the world’s most pressing challenges as highlighted in the Report.
CPA Caroline Gathii, IRMCert, is an International Certified Risk Expert with FirstIdea Consulting Limited. Email: cgathii@firstideaconsulting.co.ke
