As every year, time has flown by and this week’s World Economic Forum annual meeting is now drawing to a close. Having written in my opening blog that none of the past year’s main challenges had been discussed or anticipated at Davos twelve months ago, in summing up I shall be careful in making any predictions of my own. Still, let me share what I have taken away based on what I have heard this week.
Let me start with the positives:
- The U.S. economy is storming ahead.
- The low interest environment for most of the world will not be short term.
- The massive decline in oil prices will result in more winners than losers.
- Progress in Africa is gaining traction and together with highly advantageous demographics, this makes Africa an increasingly interesting prospect from a business perspective.
- The Arab Spring has transformed the future of many countries of the Middle East and North Africa in more ways than are immediately visible on the surface. New types of politicians are emerging, women’s rights have been strengthened and whole populations have experienced that they can have influence. The taste of democracy will not easily fade away.
- An increasing number of global businesses are taking more responsibility for a wider group of stakeholders and experiencing the benefits of doing so.
Then we have some negatives:
- Concerns about the economic prospects for Europe have risen significantly.
- The Ukraine-Russia conflict will get worse before it gets better, but nobody knows how to solve it.
- Russia’s economy is going downhill, which puts pressure on the Russian leadership, which in turn raises the risk of a widening conflict with the Western World.
- Terrorist attacks under religious banners will affect the Western lifestyle and create enormous additional security costs.
- Religious wars and conflicts will not only cause massive grief, but may also challenge the solidarity of the Western World.
- Technology is a threat to the jobs of the middle class and nobody has yet come up with an answer for what millions of people can do after their jobs have been substituted by technology or digital business models.
Despite those negatives, I would like to close with an upbeat outlook. On balance, I believe there are enough positives to think the global economy will be able to thrive for the next couple of years, driven by the US and China, fuelled by low oil prices, low interest rates and massive liquidity in global financial markets. Geopolitical conflicts will unfortunately continue to be a part of our lives, but to be fair the 21st century is generally a safer place than any preceding century.
Looking at our own business against that broader backdrop, I believe JLL will continue to prosper and we will do our share – consistent with the strapline of the World Economic Forum – to improve the state of the world. That includes working with our clients to provide better buildings that are more sustainable, less of a burden on the environment and much improved as workplaces, retail and leisure destinations and homes for people right around the world.
Thank you for taking the time to read my blogs from this year’s World Economic Forum annual meeting.