Environmental crises dominate A.T. Kearney's annual predictions list

03 January 2020 Consultancy.asia 4 min. read
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Strategy and management consultancy A.T. Kearney’s annual predictions are in – and those wishing to wave goodbye to an unpleasant past decade may need to think again.

Global strategy and management consultancy A.T. Kearney has released its traditional annual predictions for the year ahead, with the firm expecting a far from settled global landscape over the next twelve months. Generational wars, water scarcity, climate challenges and an emerging disaster economy courtesy of more frequent and severe environmental catastrophes all headline, with Asia once again taking centre stage.

In addition to leading in areas such as the deployment of 5G – with China, South Korea, Japan, Singapore all out of the gates ahead of the US – and hosting cities which will see accelerated transformations to meet climatic and infrastructure challenges, Asia also features in respect to a wave of predicted water crises as to floods, water scarcity, and unclean drinking water, as well as for being a hot-spot for geopolitical tensions.

Among its ten global predictions for the year, the firm also describes a growing discord between neighbours in Northeast Asia as profound, in particular the deteriorating relations between Japan and South Korea and the enduring security threat of North Korea. Compounding these issues are the ongoing protests in Hong Kong, the development of hypersonic weapons by China and Russia, and the US’ approval of $2 billion in military hardware to Taipei.

But with out-of-control bush-fires continuing to ravage Australia into the new year, perhaps the most topical of A.T. Kearney’s predictions centres on the expansion of a new ‘disaster economy’ in 2020. Set to surpass a value of $114 billion this year, the global incident and emergency management industry is projected at above six percent annual growth in coming years from rising demand for relief technologies.

Environmental crises dominate A.T. Kearney's annual predictions list

Recently, the Indonesian government enlisted McKinsey to help in the country’s $33 billion plans to relocate its capital from Jakarta – in part due to threats of flooding, with the city currently enduring its worst event in over a decade – with A.T. Kearney citing some estimates that that the number of people displaced by such extreme weather patterns will grow by 50 percent within the next ten years.

The demand for relief technologies and services will therefore continue to rise, says A.T. Kearney, pointing to the development of technological solutions in areas such as AI and predictive machine learning. “Although post-disaster aid continues to be delivered primarily through non-profits and international organisations, the business case for private sector investment is growing. Start-ups are therefore beginning to emerge as sources of disaster relief.”

Elsewhere among the firm’s predictions for 2020 are a halal market, including within the travel, fashion, media and recreation, pharmaceuticals, and cosmetics segments in addition to food, set to exceed a worth of $2.5 trillion en route to $3 trillion by 2023, with the most populous Muslim country Indonesia slated to become a global halal hub. Meanwhile, India, Japan, China will be among the nations competing in an ever-more crowded outer space.

Rounding out the list, A.T. Kearney further predicts a continuing appreciation of the US dollar, the proliferation of data privacy laws around the globe, and a growing clash between generations – driven by concerns about climate change, debt, and social injustice. As part of its annual forecast, the firm also engages in the commendable practice of publically reviewing the accuracy of its previous year’s predictions, albeit self-assessed.

For 2019, A.T. Kearney has claimed a strike-rate of 100 percent for six out of ten predictions – led by the intensification of the US-China trade-war – while four of the foresights were given the 75 percent pass-mark, and one, Bitcoin leading the consolidation and maturation of the cryptocurrency market, was considered only half correct. The gold star however goes to the emergence of a real-life “Iron Man” forecast, with one man in France indeed using an exoskeleton to walk last year.