This is what the markets of tomorrow will look like

Against an increasingly contested geo-economic world order, governments are restructuring their industrial policies to meet well-defined strategic goals. In parallel, many businesses are becoming more values-led in their approach to markets, spurred by public demand and the rise of environmental, social and governance (ESG) investing.

This twin trend opens a window of opportunity to recast public-private collaboration within economics. Working together to identify priorities and build new markets means governments, investors and businesses can usher in a new era of purpose-driven growth, jobs and prosperity.

Rapid vaccine development and roll-out during the pandemic demonstrated the power of governments and businesses collaborating on innovation. The challenge now is to turn that kind of crisis response into a deliberate strategy, which aims to drive interest and investment to the technologies and sectors most likely to respond to pressing national, regional and global challenges.

Where will the markets of tomorrow be found? To help answer this question, the Markets of Tomorrow Report 2023 draws on more than 12,000 business responses to the World Economic Forum's Executive Opinion Survey from more than 120 economies.

Three key questions were asked of respondents:

At a time of rapid technological change, seeing frontier technologies prominent among business responses would be no surprise. However, according to the survey, the top three technologies globally are more foundational than frontier. Agricultural technologies were viewed as the highest strategic priority, followed by education and workforce development technologies and then power storage and generation.

There is a solid consensus across many lower- and middle-income economies on these priorities, although climate-change mitigation technologies are a higher priority among high-income countries.

There is also a notable divergence in the results for a subset of high-innovation countries (United States, China, Japan, Germany and South Korea), which cite artificial intelligence (AI) as the highest strategic priority. While this result is not surprising at a time when AI appears poised to make another technological and commercial leap forward, it also points to a potential gap between the global supply and demand for innovation outputs.

When asked about the sectors where priority technologies are most likely to lead to the development of new markets, respondents across income groups and regions ranked information and technology services first. This result reflects the Fourth Industrial Revolution's central importance to tomorrow's markets.

The agriculture sector came second and the energy sector third.

Turning to the market obstacles to be overcome, respondents pointed to a diverse range of factors where progress is needed. Firstly, there needs to be more skills and talent, highlighting the pivotal importance of human capital development. The second obstacle cited was infrastructure. In third place was a need for greater public-sector initiative, which ranked in the top three in 77 of the economies surveyed, suggesting an appetite among many businesses for a purpose-driven public approach to market co-creation.

Investors have a crucial role to play in advancing the markets of tomorrow. A key challenge is building incentive structures to ensure funding flows to strategically important projects and sectors. Often investment is targeted at frontier technologies and applications, while potential investments in known solutions promising wider societal impact can struggle. We need both.

Governments have a crucial role to play in framing the incentives for investment. They can also act directly as "investors of first resort," crowding in broader private-sector interest and financing. The findings of the Markets of Tomorrow Report 2023 point to the importance of national strategic foresight and of investment and innovation policy. They resonate with developments under way, such as the rise of more assertive industrial policies designed to ensure that market creation and support are in sync with national goals and priorities.