December 31, 2023

How Geopolitical Tensions, New Technologies, and Environmental Threats Could Upset the Economic Outlook for 2024

Though the Economist Intelligence Unit (EIU) expects modest global growth in 2024, continued monetary tightening, supply chain disruptions and geopolitical conflict could weigh heavily on the global economy next year. In a report that explores how geopolitical tensions, the advent of new technologies and persistent environmental threats could upset the outlook in the coming year, the EIU explains that its "operational risk scenarios evaluate the events that could have a severe impact on its core economic and geopolitical forecasts, challenging the operations of businesses worldwide." For example, "In 2023 resilience among consumers and a gradual fall in inflation reassured uneasy investors and supported modest global growth." The EIU expects "stable, but unspectacular, global growth to continue into 2024 as economic uncertainty recedes and major central banks begin to lower policy rates in the second half of the year. The UK-based organization's report "explores how geopolitical tensions, the advent of new technologies and persistent environmental threats could upset the outlook for 2024."

Below are ten risk scenarios that could reshape the global economy in 2024:
  1. Monetary policy tightening extends deep into 2024, leading to a global recession and financial volatility (moderate probability; high impact)
  2. A green technology subsidy race becomes a global trade war (moderate probability; high impact)
  3. Extreme weather events caused by climate change disrupt global supply chains (high probability; moderate impact)
  4. Industrial action spreads, disrupting global productivity (high probability; moderate impact)
  5. China moves to annex Taiwan, forcing a sudden global decoupling (low probability; very high impact)
  6. A change in the US administration leads to abrupt foreign policy shifts, straining alliances (moderate probability; moderate impact)
  7. Stimulus policy failures in China lead to increased state controls and diminished growth prospects (low probability; high impact)
  8. The Israel-Hamas war escalates into a regional conflict (very low probability; high impact)
  9. Artificial intelligence disrupts elections and undermines trust in political institutions (moderate probability; low impact)
  10. The Ukraine-Russia war spirals into a global conflict (very low probability; very high impact)

While business leaders should be mindful of the ten risk scenarios, there are three that I am watching closely. As someone who follows the green technology sector, I have concerns about how a subsidy race could turn into a global trade war. As the EIU explains: "Western economies are rolling out generous incentives for businesses to invest in clean energy technologies by boosting domestic industrial capacity and enabling greater competition with China, which is the leader in the production of many green technologies. These initiatives also aim to accelerate countries’ transition towards achieving net-zero greenhouse gas emissions, but most incentives include strict sourcing requirements for components (notably in the US). These requirements have already spurred tensions between the EU and the US, and will probably raise the cost of inputs and subsequently the green technologies themselves."

The report importantly adds that should "relations with China experience a severe downturn (including in relation to strengthening China-Russia ties or deepening concerns over China's state-driven industrial policy), Western economies could increase existing tariffs on Chinese imports or accelerate decisions on pending investigations into anti-dumping and state subsidy charges, further fueling price growth. China would retaliate, possibly by blocking exports of raw materials that are critical to the green transition agenda such as rare earths, making decarbonization efforts more expensive for developed markets. These costs would force economies to consider returning to carbon-based technologies, limit support from Western countries to fund emerging markets' energy transition and delay timelines for achieving net-zero emissions."

Regarding the spread of industrial action that will lead to the disruption of global productivity, the EIU says: "High global commodity prices, continued supply-chain disruptions, high food prices and continued currency weakness against the US dollar for some countries will continue to fuel discontent in 2024-25." What is more, "Wages have not risen as quickly as inflation in most countries, making it harder for poorer households to purchase basic staples. This could spark social unrest, expanding the small-scale protests and industrial action already seen in Europe, the US, South Korea and Argentina. In an extreme scenario, protests could push workers in major economies and who are employed by large manufacturers to co-ordinate large-scale strikes demanding salary increases that match inflation. Such movements, like those that have affected the automotive industry in the US and key services in the UK (healthcare, ports and railways), could paralyze entire industries or public services for an extended period and spill over to other sectors or countries, weighing on global growth."

As for artificial intelligence disrupting elections and undermining trust in political institutions, the EIU points out that "Global firms and governments have rapidly begun to test and integrate generative artificial intelligence (AI) into existing platforms and processes." Furthermore, the EIU believes "AI will augment (rather than replace) human capabilities, presenting an opportunity for firms to improve productivity. However, the widespread adoption of AI and its use in social media will raise the risk of a spread in disinformation campaigns via text, imagery, audio and video in the coming years. Regulation across different geographies is coming, but malicious actors will still look to implement wide-ranging programs aimed at fueling existing skepticism of some citizens towards governments." The report crucially notes that "This could potentially shift the result of major elections scheduled for 2024—including for the EU parliament, and in the US, the UK, India and Taiwan—and more broadly erode voters' trust in political systems."

The world is facing geopolitical tensions, the advent of new technologies, and persistent environmental threats that could upset the economic outlook for the coming year. Which of the global risk scenarios will you be watching?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

December 26, 2023

Growth Prospects, Risks and Trends in Six Critical Sectors in 2024

The past few years have been turbulent for most companies as the pandemic, soaring commodity prices, high interest rates and political disruption resulted in profits for many and bankruptcy for some. A report published by the Economist Intelligence Unit (EIU) asks: Will conditions stabilize in 2024?

EIU's report provides growth prospects, risks and trends facing six critical sectors in the coming year, as inflation eases but geopolitical tensions remain high. The report argues that the biggest challenge facing businesses next year will be climate change and looks at how experimentation with artificial intelligence will give way to rapid adoption, changing corporate strategies and the nature of work.

Key findings include:
  • Climate change will drive demand in sectors relating to mitigation and adaptation. Insurers, companies and governments will struggle to price in the increasing risks.
  • EU and US regulations on environmental, social and governance (ESG) reporting will push companies to scrutinize their operations and supply chains. However, skepticism about ESG will harden in the US ahead of November’s presidential elections.
  • Corporate concerns over taxation will increase as the OECD introduces its global minimum tax rate and individual governments try to reduce budget deficits and national debt levels.
  • Geopolitical tensions and wars will complicate government and corporate responses to all of the above. Investment in supply chains, particularly for technology and the energy transition, will adapt to minimize political risk.
  • Generative artificial intelligence will disrupt a few sectors, but most companies will find ways to use AI to increase productivity.

The report also provides key global forecasts for each sector covered:
  • Automotive: The automotive industry will face another subdued year in 2024, weighed down by slow consumer spending, high interest rates and disruption to supply chains due to geopolitical tensions. The only bright spot will be the electric vehicles market, with sales expected to soar by 21% to 14.9 million unit as governments and consumers try to mitigate the worsening effects of climate change. The report notes that established carmakers will have to fight hard to hold off competition from China.
  • Consumer goods and retail: A slowdown in inflation will bolster retail volume growth by 6.7% in US dollar terms and 2% in volume terms in 2024. However, reduced savings and high food prices, worsened by the effects of climate change, will act as dampeners. The EIU also points out that high food prices will continue to cause problems in Asia.
  • Energy: Global energy consumption will grow by 1.8% in 2024, largely driven by strong demand in Asia. Despite still-high prices and unsolved supply chain disruptions, demand for fossil fuels will reach record levels, but demand for renewable energy will rise by 11%.
  • Finance: High interest rates will determine the success or failure of almost every part of the financial services sector in 2024. Though painful for borrowers, banks will enjoy strong net interest margins margins and revenue flows until margins begin to narrow mildly in late 2024. Property firms and funds, however, will suffer.
  • Healthcare: Healthcare spending will rise by 2% in real US-dollar terms, following two years of decline, as inflation eases. However, resources will remain constrained as governments try to bring down fiscal deficits and public debt levels.
  • Telecoms and technology: Geopolitics will continue to affect technology in 2024. The tech battle between the US and China will persist in areas including artificial intelligence (AI), chips and quantum technologies. AI will continue to develop, particularly generative AI, but will encounter challenges from new regulations in the EU and other major jurisdictions, as well as complications from US-China tensions.

I appreciate how the annual industry outlook provides businesses with foresight of the critical global trends and threats that will affect their sector 2024. Which trends and threats are you watching in the coming year?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

December 20, 2023

Recommendations for Reinventing American Democracy for the 21st Century

There is much discussion among my peers about the fragility of American democracy. Some hold the view that American democracy is unraveling through shifting political, economic, and social forces. Others see the current challenges America's democracy is facing as an opportunity to refocus on the principals the country's founders endowed over 200 years ago. Efforts to refocus will require a redesign of American institutions so that they are simultaneously responsive and accountable. A report published by the American Academy of Arts & Sciences explores how to reinvent American democracy for the 21st century.

Segmented into six sections, the report presents 31 recommendations on how to reinvent American democracy in the 21st century:


Recommendation 1.1
Substantially enlarge the House of Representatives through federal legislation to make it and the Electoral College more representative of the nation’s population.

Recommendation 1.2
Introduce ranked-choice voting in presidential, congressional, and state elections.

Recommendation 1.3
Amend or repeal and replace the 1967 law that mandates single-member districts for the House, so that states have the option to use multi-member districts on the condition that they adopt a non-winner-take all election model.

Recommendation 1.4
Support adoption, through state legislation, of independent citizen-redistricting commissions in all fifty states. Complete nationwide adoption, through federal legislation, that requires fair congressional districts to be determined by state-established independent citizen-redistricting commissions; allows these commissions to meet criteria with non-winner-take-all models; and provides federal funding for these state processes, with the goal of establishing national consistency in procedures.

Recommendation 1.5
Amend the Constitution to authorize the regulation of election contributions and spending to eliminate undue influence of money in our political system, and to protect the rights of all Americans to free speech, political participation, and meaningful representation in government.

Recommendation 1.6
Pass strong campaign-finance disclosure laws in all fifty states that require full transparency for campaign donations, including from 501(c)(4) organizations and LLCs.

Recommendation 1.7
Pass "clean election laws" for federal, state, and local elections through mechanisms such as public matching donation systems and democracy vouchers, which amplify the power of small donors.

Recommendation 1.8
Establish, through federal legislation, eighteen-year terms for Supreme Court justices with appointments staggered such that one nomination comes up during each term of Congress. At the end of their term, justices will transition to an appeals court or, if they choose, to senior status for the remainder of their life tenure, which would allow them to determine how much time they spend hearing cases on an appeals court.


Recommendation 2.1
Give people more choices about where and when they vote, with state-level legislation in all states that supports the implementation of vote centers and early voting. During an emergency like COVID-19, officials must be prepared to act swiftly and adopt extraordinary measures to preserve ballot access and protect the fundamental right to vote.

Recommendation 2.2
Change federal election day to Veterans Day to honor the service of veterans and the sacrifices they have made in defense of our constitutional democracy, and to ensure that voting can occur on a day that many people have off from work. Align state election calendars with this new federal election day.

Recommendation 2.3
Establish, through state and federal legislation, same-day registration and universal automatic voter registration, with sufficient funding and training to ensure that all government agencies that have contact with citizens include such registration as part of their processes.

Recommendation 2.4
Establish, through state legislation, the preregistration of sixteen- and seventeen-year-olds and provide educational opportunities for them to practice voting as part of the preregistration process.

Recommendation 2.5
Establish, through congressional legislation, that voting in federal elections be a requirement of citizenship, just as jury service is in the states. All eligible voters would have to participate, in person or by mail, or submit a valid reason for nonparticipation. Eligible voters who do not do so would receive a citation and small fine. (Participation could, of course, include voting for "none of the above.")

Recommendation 2.6
Establish, through state legislatures and/or offices of secretaries of state, paid voter orientation for voters participating in their first federal election, analogous to a combination of jury orientation and jury pay. Most states use short videos produced by the state judicial system to provide jurors with a nonpolitical orientation to their duty; first-time voters should receive a similar orientation to their duty.

Recommendation 2.7
Restore federal and state voting rights to citizens with felony convictions immediately and automatically upon their release from prison, and ensure that those rights are also restored to those already living in the community.


Recommendation 3.1
Adopt formats, processes, and technologies that are designed to encourage widespread participation by residents in official public hearings and meetings at local and state levels.

Recommendation 3.2
Design structured and engaging mechanisms for every member of Congress to interact directly and regularly with a random sample of their constituents in an informed and substantive conversation about policy areas under consideration.

Recommendation 3.3
Promote experimentation with citizens' assemblies to enable the public to interact directly with Congress as an institution on issues of Congress's choosing.

Recommendation 3.4
Expand the breadth of participatory opportunities at municipal and state levels for citizens to shape decision-making, budgeting, and other policy-making processes.


Recommendation 4.1
Establish a National Trust for Civic Infrastructure to scale up social, civic, and democratic infrastructure. Fund the Trust with a major nationwide investment campaign that bridges private enterprise and philanthropic seed funding. This might later be sustained through annual appropriations from Congress on the model of the National Endowment for Democracy.

Recommendation 4.2
Activate a range of funders to invest in the leadership capacity of the so-called civic one million: the catalytic leaders who drive civic renewal in communities around the country. Use this funding to encourage these leaders to support innovations in bridge-building and participatory constitutional democracy.


Recommendation 5.1
Form a high-level working group to articulate and measure social media's civic obligations and incorporate those defined metrics in the Democratic Engagement Project, described in Recommendation 5.5.

Recommendation 5.2
Through state and/or federal legislation, subsidize innovation to reinvent the public functions that social media have displaced: for instance, with a tax on digital advertising that could be deployed in a public media fund that would support experimental approaches to public social media platforms as well as local and regional investigative journalism.

Recommendation 5.3
To supplement experiments with public media platforms (Recommendation 5.2), establish a public-interest mandate for for-profit social media platforms. Analogous to zoning requirements, this mandate would require such for-profit digital platform companies to support the development of designated public-friendly digital spaces on their own platforms.

Recommendation 5.4
Through federal legislation and regulation, require of digital platform companies: interoperability (like railroad-track gauges), data portability, and data openness sufficient to equip researchers to measure and evaluate democratic engagement in digital contexts.

Recommendation 5.5
Establish and fund the Democratic Engagement Project: a new data source and clearinghouse for research that supports social and civic infrastructure. The Project would conduct a focused, large-scale, systematic, and longitudinal study of individual and organizational democratic engagement, including the full integration of measurement and the evaluation of democratic engagement in digital contexts.


Recommendation 6.1
Establish a universal expectation of a year of national service and dramatically expand funding for service programs or fellowships that would offer young people paid service opportunities. Such opportunities should be made available not only in AmeriCorps or the military but also in local programs offered by municipal governments, local news outlets, and nonprofit organizations.

Recommendation 6.2
To coincide with the 250th anniversary of the Declaration of Independence, create a Telling Our Nation's Story initiative to engage communities throughout the country in direct, open-ended, and inclusive conversations about the complex and always evolving American story. Led by civil society organizations, these conversations will allow participants at all points along the political spectrum to explore both their feelings about and hopes for this country.

Recommendation 6.3
Launch a philanthropic initiative to support the growing civil society ecosystem of civic gatherings and rituals focused on the ethical, moral, and spiritual dimensions of our civic values.

Recommendation 6.4
Increase public and private funding for media campaigns and grassroots narratives about how to revitalize constitutional democracy and encourage a commitment to our constitutional democracy and one another.

Recommendation 6.5
Invest in civic educators and civic education for all ages and in all communities through curricula, ongoing program evaluations, professional development for teachers, and a federal award program that recognizes civic-learning achievements. These measures should encompass lifelong (K–12 and adult) civic-learning experiences with the full community in mind.

Among the recommendations listed above, I strongly support ranked-choice voting in presidential, congressional, and state elections (1.2), changing federal election day to Veterans Day (Nov. 11th) (2.2), and adopting formats, processes, and technologies that are designed to encourage widespread participation by residents in official public hearings and meetings at local and state levels (3.1). While I also support amending the Constitution so that Supreme Court justices serve a term limited to a pre-set number of years, twelve- or sixteen-year terms are more reasonable than eighteen-year terms. Lastly, although same-day voter registration will improve access for people to elect their government leaders (2.3), universal automatic voter registration makes me nervous as I have concerns about any government agency implementing a registration system without the explicit consent of the individual.

In a letter published in Our Common Purpose, David W. Oxtoby, president of American Academy of Arts and Sciences, writes: "Throughout our country's history, the American people have confronted moments of crisis with resilience and an openness to reinvention, enabling our nation to become a better version of itself." He adds that "The recommendations in this report touch all sectors of American life and offer a bold path that will require all of us to commit to reinventing aspects of our constitutional democracy." Despite the currently challenges facing our great nation, I remain optimistic that Americans will take advantage of the opportunity to create a better version of our great nation.

What are you thoughts?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

December 11, 2023

Forging a Resilient Digital Indonesia

"The government of Indonesia is keen to build a digital nation, in which digital technologies help improve the livelihoods of citizens and drive productivity in key sectors of the economy," according to a report by the GSMA. "This has been highlighted in several digitalization plans announced in recent years. The main elements of the plans align with the five components of a digital nation: infrastructure, innovation, data governance, security and people."

The UK-based organization adds that "Although steps have been taken towards a digital nation, there remains room for improvement and an opportunity to accelerate progress. This is particularly crucial in the context of 5G and other emerging technologies (such as AI and quantum computing) transforming Indonesian society and contributing to the government’s target for the country to become a top 10 global economy by 2030." The report encouragingly points out: "The industry (mobile operators and other ecosystem players) will invest nearly $18 billion between 2024 and 2030, mostly on 5G networks. 5G technology is projected to contribute $41 billion to Indonesia's GDP during that period."

Having advised government leaders in countries similar to Indonesia who are trying to build a digital nation, I appreciate the GSMA's assertion that "Realizing the government's vision of building a resilient digital nation and using digital technologies to drive economic growth relies on formulating and implementing policies to advance each of the five components of a digital nation." Accordingly, the report presents the following recommendations:
  • Infrastructure: Implement spectrum pricing policies and other policy initiatives to ensure sustainable private sector investment in digital networks. Such policies will facilitate the continued expansion of the high-performance mobile networks and other digital infrastructure required to build a resilient digital nation.
  • Innovation: Take a holistic approach to digital innovation across government, supported by agile policy approaches, such as regulatory sandboxes and policy labs, and make a concerted effort to increase research funding in Indonesia.
  • Data governance: Continue on the path to the full enforcement of the personal data protection law, which was enacted in 2022, and consult widely with stakeholders across the public and private sectors on guidelines on the use of AI and other emerging technologies.
  • Security: Develop a comprehensive cybersecurity law to streamline current fragmented laws, and adopt ecosystem-wide collaboration to strengthen cyber resilience, disrupt cybercrime and tackle other online threats.
  • People: Accelerate efforts to bring more people online by closing the remaining coverage and usage gaps. Implement initiatives to build a digitally-ready workforce with the necessary knowledge and skills to utilize digital technologies across different sectors of the economy.

The report's authors adds: "The task of becoming a digital nation is multidimensional, involving many different actors from the public and private sectors and non-state institutions. Meanwhile, digital technologies continue to evolve rapidly, offering new opportunities but also challenges that need to be approached holistically. In this context, a whole-of-government approach (WGA) is essential to streamline efforts and realize efficiencies in formulating and implementing digital nation initiatives. This approach will bring together multiple stakeholders and diverse resources to provide a common solution to key issues."

In addition to Indonesia, other members of the Association of Southeast Asian Nations (ASEAN) have plans to building a resilient digital nation. The recommendations presented by this report can be a useful guide for how to successfully use digital technologies to drive economic growth.

Do you agree with the report's recommendations?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

December 9, 2023

Helping Policymakers and Stakeholders Understand Risk and Design Effective Policies for Urban Resilience

According to a report developed by Economist Impact and supported by the Tokio Marine Group, "The world is facing unprecedented challenges. Extreme weather events, from hurricanes and wildfires to flooding and heatwaves, are becoming more frequent and their effects more devastating." Furthermore, "Emerging risks like cyber-attacks loom larger as technology dependence deepens. Our cities are exposed to all of these risks and more. Lives and livelihoods depend on our ability to understand and mitigate the evolving threats to our urban centers."

The Resilient Cities Index highlights three phases to resilience. "Preparation and mitigation come first. Understanding the risks, how they are evolving and taking steps to minimize their impact is essential if cities are to avoid the worst. The second phase is response, necessitating swift reactions and timely assistance to save lives and diminish the impact when disasters occur. Last is recovery, emphasizing the need to learn from tragedies and rebuild stronger, better-equipped communities for future shocks and stresses."

Aiming to help policymakers and stakeholders understand risk and design effective policies for urban resilience, Economist Impact developed a benchmark of 25 cities. To gauge the resilience of these cities, the report's authors took measurements across four pillars: critical infrastructure, environment, socio-institutional and economic. This white paper combines index analysis with expert commentary to identify patterns, common strengths, deficits and best practices across index cities.

Key findings from the inaugural edition of the Resilient Cities Index include:
  • Cities performed well in the critical infrastructure pillar of the index, but there are some weak points that require strategic focus. The cities with the highest scores were Dubai, Shanghai, New York and Singapore. These capital-rich market locations have greater opportunities to develop new infrastructure, compared with European cities constrained by decades- or centuries-old systems. Within this pillar, digital infrastructure and transportation were a drag on cities' resilience.
  • Cities that use data and technology to create operational efficiencies and share information with their citizens—i.e., smart cities—are better at dealing with shocks. Patchy internet quality, which can impede access to digital services, pulled down the overall resilience score in the critical infrastructure pillar. Digital technologies and advanced data analytics can help to predict risks, optimize existing systems and keep the public informed. Greater digitalization comes with risks, especially to critical infrastructure, but most cities in the index have built safeguards against this.
  • Most emerging economy cities lack adequate regulatory frameworks, strategies and incentives for futureproofing infrastructure. Only a few cities in the index achieved high scores for future-proofing, which involves ensuring infrastructure preparedness for shocks while managing current and future emissions. One way cities can future-proof is by incentivizing sustainable designs for buildings, such as installing green roofs, incorporating modularity and retrofitting for energy efficiency—a practice only found in high-income cities in the index.
  • Efforts to achieve environmental resilience are led by innovative solutions. Cities are employing a variety of nature-based solutions to adapt to flooding and heat stress, from planting rooftop vegetation and mangrove forests (green infrastructure) to rehabilitating wetlands (blue infrastructure). Cities are also decarbonizing by adopting renewable energy and negative emission technologies, such as carbon capture, storage and removal. However, the scalability of these technologies is likely to be challenging for resource-constrained emerging market cities.
  • Cities demonstrated poorer performance in the socio-institutional pillar, mostly due to income inequality and poor health and well-being metrics. Only nine cities have a single, comprehensive plan to support vulnerable groups. However, one bright spot is that cities are promoting a culture of readiness to act in the event of a disaster. The majority of cities scored highly on this or are working to improve their readiness.
  • Cities had the lowest average scores in the economic pillar, dragging down some cities that performed well in other areas. The low penetration of financial safety nets hinders safeguards against threats and undermines a city's ability to recover from shocks. Another aspect of economic resilience is a city’s ability to incubate innovation, which can foster solutions to a range of problems, from congestion to water stress. Unfortunately, most cities scored poorly on the indicator for start-up ecosystems.

The report's conclusion points out that "A resilient city is not only prepared for shocks but has the ability to bounce back and thrive. Recognizing both existing and looming threats will help cities better understand their vulnerabilities and design targeted actions. However, building such cities requires stakeholders from government, businesses and communities, as well as individual city-dwellers, to engage in holistic resilience thinking at community and municipality levels."

Moreover, "While resilience needs to be tackled in myriad ways, a number of critical strategies have been identified in the course of this research and are summarized below."
  • Empower the community to be active participants. This is contingent on the democratization of information. All city-dwellers should have equal access to government information, including what to do in an emergency. Some cities, like Singapore, do this very well, using digital channels to disseminate information to everyone simultaneously. Fostering a culture of readiness and the ability to manage hazards will require investment to train and educate people at governing and grassroots levels to be stewards of their city. Recognizing that information is key, municipalities could consider partnering with a digital platform to minimize misinformation and ensure the city moves in one direction, despite disruption.
  • Social cohesion efforts need greater advancement across the board. Cities are nothing without the people who inhabit them. Greater attention to social cohesion will help to ensure cities are less fragmented, adaptive and better prepared for shocks. City governments should overlay resilience efforts with initiatives that aim to improve the lives of urban residents. This process should be driven by city leadership and engage civil society. The majority of cities in the index have some way to go to strengthen social cohesion through integration programs for society's most vulnerable.
  • Early warning systems (EWS) are vital for safe cities but investment is needed to hit the 2027 target. National governments and municipality leaders will have to collaborate to ensure universal early warning systems coverage by 2027. There are two challenges that need to be met. First, capital is needed to bridge the investment gap for technologies with a greater push for the development and adoption of frontier and horizon tech–from drones to AI. Second, governments need to facilitate the necessary legislation to connect these EWS to emergency and response plans to ensure there are protocols and resources in place to deal with climate extremes and hazards. Community acceptance and responsiveness to early warnings are essential in the effectiveness of EWS. This can be achieved through systematic training and education and awareness programs.

What do you think of the report's findings and conclusions? Do you have additional recommendations on how policymakers and stakeholders understand risk and design effective policies for urban resilience?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.

December 7, 2023

5G's GDP Contribution in MENA Is Expected to Reach $60B in 2030, Representing 13% of the Overall Annual Economic Impact of Mobile in the Region

As the UN Climate Change Conference finds down in Dubai, many people unfamiliar with the Middle East and North Africa (MENA) are becoming aware of efforts to diminish the reliance on fossil fuel as the key producer of economic output. Having done business in the MENA region for several years, I have witnessed the efforts made by several governments to promote private sector development in several key industries including mobile technology. In its most recent annual report on the state of MENA's mobile economy, the GSMA points out that the region "home to some of the global leaders in terms of 5G adoption, reflecting the ambitious rollout plans of operators, backed by enabling regulations and strong demand from consumers for new services." Furthermore, "5G networks now cover 75% or more of the population in the GCC states, with operators in those markets increasingly shifting focus to improving 5G coverage in less densely populated areas while also ramping up investment to support the growing momentum behind use cases enabled by 5G standalone (SA) and 5G-Advanced." The GCC, or Gulf Cooperation Council, is comprised of six nations: Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

The GSMA notes that "5G's GDP contribution is expected to reach $60bn in 2030, representing 13% of the overall annual economic impact of mobile in the region." The report's additional key findings include:

5G SA and 5G-Advanced will be at the heart of 5G's next phase

"By September 2023, six operators in MENA had already rolled out 5G SA networks, contributing to 15% of the global total. Operators in MENA have also begun planning for 5G-Advanced. The use case for 5G-Advanced is straightforward: to enable 5G to support new market demands while waiting for the arrival of 6G. 5G SA and 5G-Advanced will help operators to serve consumer and enterprise customers more flexibly. The adoption of private 5G networks, meanwhile, has been slower in MENA compared with other regions, but there is growing evidence that this is starting to change."

Operators look to monetize tower assets

"The majority of tower assets have traditionally remained in the hands of mobile operators in MENA. However, following STC's creation of Tawal in 2019, the first tower company in Saudi Arabia, an increasing number of operators in MENA have embarked upon infrastructure reshuffling, including the monetization of underutilized tower assets. Independent tower companies have been among the main acquirers of operator sites, utilizing multitenancy to drive profitability. In other instances, operators have spun off infrastructure in partnership with private equity groups or issued IPOs for their tower assets. Tower sales and spin-offs enable operators to reallocate capital towards areas with higher growth prospects."

GCC telcos target stakes in European counterparts

"International expansion has been a core growth and diversification strategy for GCC telcos looking for opportunities to scale up and drive new revenue and subscriber growth. Historically, GCC operators had bet big on emerging markets across South Asia, Southeast Asia, Sub-Saharan Africa and other parts of MENA. However, recent developments suggest a growing interest in long-established European operators. e& and STC are leading the charge, having made several high-profile deals and announcements since early 2022. The strategic rationale lies in the potential to become global players in the TMT space, both in terms of scale and innovation."

The shift to circularity gathers momentum

"In response to escalating concerns regarding the generation of e-waste and the unsustainable depletion of natural resources, the concept of circularity has surged to the forefront of the agendas for policymakers and industry stakeholders. This amplified focus on sustainability is particularly evident in view of the region's role as the host for the 2023 United Nations Climate Change Conference (COP28) in Dubai. Governments and industry participants in the region are taking proactive measures to establish new channels and suppliers dedicated to collecting, refurbishing and reselling devices and network equipment."

Regulatory enablers and innovation hubs fuel fintech growth

"MENA has experienced a significant surge in fintech services, driven by increased investments and regulatory enablement. Regulatory sandboxes and dedicated fintech hubs have been important contributors to this, with digital payment solutions gaining prominence in recent years, including
contactless payments, open banking and buy now, pay later (BNPL) services. Mobile operators are actively involved in the fintech space, expanding access and inclusion for consumers and businesses through a variety of financial-services products and partnerships with established fintech providers."

Infographic: GSMA

Significant opportunities exist for MENA entrepreneurs to develop localized solutions in AI, IoT, cybersecurity, EdTech, fintech, digital health, e-commerce, and enterprise services. As the report explains, "Beyond its contribution to GDP, the mobile ecosystem also supports over 800,000 jobs (directly and indirectly) and makes a substantial contribution to the funding of the public sector, with $20 billion raised through taxation in 2022. This economic contribution underlines the importance of stakeholders taking the right steps to sustain the impact of mobile services on the digital economy, with spectrum availability a key driver of affordable 5G for all."

What opportunities are you seeing in the region?

Aaron Rose is a board member, corporate advisor, and co-founder of great companies. He also serves as the editor of GT Perspectives, an online forum focused on turning perspective into opportunity.