COVID-19's legacy: This is how to get the Great Reset right

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Many things will change forever after COVID-19. Image: cluttersnap on Unsplash

Klaus Schwab
Founder and Executive Chairman, World Economic Forum
Thierry Malleret
Founder and Managing Partner, Monthly Barometer
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The Great Reset

  • The worst of the pandemic is yet to come and the world has reached a defining moment.
  • We must get the Great Reset right. The challenges are greater than previously imagined, but our capacity to reset is also greater than we had previously dared to hope.

This article accompanies the launch of COVID-19: The Great Reset, the new book by Klaus Schwab and Thierry Malleret on the COVID crisis and its impacts. It can be ordered here, and you can leave a review here.

The worst of the pandemic is yet to come. To date, only a few countries are effectively containing the virus, while in a majority of nations, COVID-19 is either raging or resurfacing with local outbreaks, limited or not so.

Already, in barely six months, the COVID-19 pandemic has plunged our world in its entirety - and each of us individually - into the most challenging times we’ve faced in generations. It is a defining moment – we will be dealing with its fallout for years, and many things will change forever. It has wrought (and will continue to do so) economic disruption of monumental proportions, creating risk and volatility on multiple fronts – political, social, geopolitical – while exacerbating deep concerns about the environment and also extending the reach (pernicious or otherwise) of technology into our lives.

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No industry or business will be spared from the impact of these changes. Millions of companies risk disappearing and many industries face an uncertain future; a few will thrive.

On an individual basis, for many, life as they’ve always known it is unravelling at alarming speed. This said, acute crises favour introspection and foster the potential for transformation.

The fault lines of today’s world – most notably: social divides, lack of fairness, absence of cooperation, failure of global governance and leadership and the critical degradation of our natural assets – lie exposed as never before, and many now feel the time for reinvention may have dawned.

A new world could emerge, the contours of which it is incumbent on us to re-imagine and to re-draw.

The sudden and violent nature of the shock the pandemic is inflicting can make the scale of this challenge seem overwhelming. This impression is due in no small measure to the fact that in today’s interdependent and hyper-connected world, risks amplify each other: individual risks or issues harbour the potential to create ricochet effects by provoking others (like unemployment potentially fuelling social unrest and impoverishment triggering involuntary mass migration).

The defining feature of today’s world is systemic connectivity: in such a world, “silo-doing” and “silo-thinking” have no place because risks converge. All the macro issues that exert direct and daily impacts on our societies, the global economy, geopolitics, the environment and technology do not evolve in a linear fashion.

They play out as complex adaptive systems, and as such share a fundamental attribute: susceptibility to matters cascading out of control and in so doing producing extreme consequences that often come as a surprise and for which we are ill prepared. COVID-19 has already given us a foretaste of this.

To a considerable extent, occurrences as different as the sharp and dramatic rise in unemployment (an economic risk), the global wave of social unrest unleashed by the Black Lives Matter protests (a societal issue) and the growing fracture between China and the US (a geopolitical risk) wouldn’t have taken place without the pandemic. At the very least, they were exacerbated by it.

The concurrence and severity of these fault lines mean that we are now at a critical juncture: the potential for change is unlimited and bound only by our imagination – for better or for worse. Societies could be poised to become either more equitable or the opposite; geared towards more solidarity or greater individualism; favouring the interests of the few or looking to the needs of the many; economies, when they recover, could be characterized by greater inclusivity and more attuned to our global commons, or they could simply return to business as usual – now revealed to be (in so many ways) an untenable status quo.

Will there be enough collective will to take advantage of this unprecedented opportunity to reimagine our world, in a bid to make it a better and more resilient one as it emerges on the other side of this crisis?

This is the fundamental question upon which the success of the Great Reset depends. The scope of change required is immense, ranging from elaborating a new social contract to forging improved international collaboration. Immense but far from insurmountable, as the case for smart investment in the environment shows.

The immediate post crisis period offers a small window to build back better by not wasting the $10 trillion that governments around the world are investing to alleviate the effects of the COVID-19 pandemic. One way to invest smartly is to embed climate and environmental resilience into stimulus packages and recovery programmes.

A recent policy paper to which the World Economic Forum contributed estimates that building a nature-positive economy could represent more than $10 trillion per year by 2030 – in terms of new economic opportunities as well as avoided economic costs. In the short term, deploying around $250 billion of stimulus funding could generate up to 37 million nature-positive jobs in a highly cost-effective manner. Resetting the environment should not be seen as a cost, but rather an investment that will generate economic activity and employment opportunities.

We must get the Great Reset right. The challenges before us could be more consequential than we have until now chosen to imagine, but our capacity to reset could also be greater than we had previously dared to hope.

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