Risk scenarios (according to the Economist Intelligence Unit – EIU)

Mid-term risk scenarios according to EIU:

Ø  The return of Donald Trump to the US presidency disrupts global trade and security alliances (very high probability, very high impact).

Ø  A green technology subsidy race becomes a global trade war (moderate probability, high impact).

Ø  Extreme weather events caused by climate change disrupt global supply chains (moderate probability, high impact).

Ø  China moves to annex Taiwan, forcing a sudden global decoupling (low probability, very high impact).

Ø  The Israel-Hamas war escalates into a regional conflict (moderate probability, high impact).

Ø  Stimulus policy failures in China lead to increased state controls and diminished growth (low probability, high impact).

Ø  Cyber-attacks damage critical infrastructure (moderate probability, very high impact).

Ø  Oil spills in the Arctic create a major environmental incident, stoking global tensions (low probability, high impact).

Ø  Rapid application of AI disrupts employment in the global services industry (low probability, moderate impact).

Ø  Delays in monetary policy easing lead to a global economic downturn (moderate probability, high impact).

Very high probability = greater than 40% probability that the scenario will occur over the next two years

High = 31-40% probability

Moderate = 21-30% probability

Low = 11-20% probability

Very low = 0-10% probability

 

Very high impact = change to global annual GDP compared with the baseline forecast of 2 % or more (increase in GDP for positive scenarios, decrease for negative scenarios)

High = 1-1.9% change

Moderate = 0.5-0.9% change

Low = 0.2-0.5% change

Very low = 0-0.1% change

 

More information: darja.zlogar@cmsr.si