Global Trendometer Essays On Medium and

Global
Trendometer
Essays on medium- and
long-term global trends
Autumn 2016
GLOBAL TRENDOMETER
Essays on medium- and long-term global trends

Autumn 2016
Study
October 2016
Global Trends Unit
AUTHORS
Danièle Réchard, Head of Unit
Eamonn Noonan
Leopold Schmertzing
Freya Windle-Wehrle
Arun Frey (trainee; supervisor: Danièle Réchard)
Global Trends Unit
Marcin Cesluk-Grajewski
Strategy and Coordination Unit
ABOUT THE PUBLISHER

This paper has been drawn up by the Global Trends Unit of the Directorate for Impact Assessment
and European Added Value, within the Directorate–General for Parliamentary Research Services
(DG EPRS) of the European Parliament.
To contact the Global Trends Unit please write to: EPRS-GlobalTrends@europarl.europa.eu.
ADDITIONAL CONTRIBUTIONS
Didier Bourguignon, Frédéric Gouardères, Beatrix Immenkamp, Nera Kuljanic, Eleni Lazarou, Anja
Radjenovic, Martin Russell, Andrej Stuchlik, Susanna Tenhunen.
LINGUISTIC VERSION
Original: EN
Manuscript completed in October 2016.

Brussels, © European Union, 2016.
Cover photo credit: Shutterstock.
DISCLAIMER
The content of this document is the sole responsibility of the authors and any opinions expressed
therein do not necessarily represent the official position of the European Parliament. It is addressed
to the Members and staff of the EP for their parliamentary work. Reproduction and translation for
non-commercial purposes are authorised, provided the source is acknowledged and the European
Parliament is given prior notice and sent a copy.
PE 573.301
ISBN 978-92-846-0104-2
doi: 10.2861/653859
QA-06-16-063-EN-N
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Global Trendometer - Autumn 2016
Table of Contents
1. Introduction ................................................................................................................................... 5
2. Essays ............................................................................................................................................. 7
I. Water Scarcity: an avoidable crisis? ................................................................................................ 7
II. Increasing inequality: from a social and political challenge to an economic problem? ................ 13
III. Foundations of US military power in 2030: leading from the front or from behind? .................... 19
3. Vignettes ...................................................................................................................................... 26
I. The Asian century: economic powerhouse or stuck in transit ....................................................... 26
II. Jobless growth: will robots and computers destroy our jobs?....................................................... 28
III. Blockchains and trust: a revolution, reformation or just another tech-toy? ................................. 30
IV. Additive Manufacturing in 2030: how the next Gutenberg revolution may bring production
back to Europe ............................................................................................................................... 32
V. Intolerance and hate crime: the return of an old problem? .......................................................... 34
VI. The mobile internet and democracy: less citizen empowerment than we thought? .................... 36
VII. Russia and China in 2030: authoritarian alliance or geopolitical rivals?....................................... 38
VIII. Democracy in the Middle East and North Africa in 2030 .............................................................. 40
4. Essay Bibliographies ...................................................................................................................... 43
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1. Introduction
Ignoranti quem portum petat nullus suus ventus est.

If you do not know to which port you are sailing,
there is no such thing as a favourable wind.
Seneca1
Global warming, demographic change, mounting inequality, changing balance of power, societal
impact of the ongoing technological revolution: in the face of these and other global trends, the
world in 2030 or 2040 may appear so unknown, so complex and so distant that it would seem vain
to prepare for it, as ’no one has a crystal ball‘. There is no shortage of crises - the euro, Greek debt,
refugees, terrorism, Brexit - all calling for difficult and immediate political responses.
Moreover, how can political decision-makers take time out from dealing with the immediate agenda
to focus sufficiently on long-term trends, and to manage the thousands of pages of detailed,
specialist analysis produced by the major international think tanks and foresight centres?
Yet the need to draw a link between today's decisions and the long-term future is not a distraction.
Prevention is better than cure, and steps which strengthen our ’resilience’ are needed. With this in
mind, the European Parliament has contributed actively to the development of the inter-institutional
European Strategy and Policy Analysis System (ESPAS). As the Parliament’s President, Martin
Schulz, stated recently: ‘In too many policy fields, there is a tendency to fail to address issues for the
long-run ... This has to change.’2
With the publication of the first edition of this new ’Global Trendometer’, the European
Parliamentary Research Service (EPRS) seeks to enhance its contribution to strategic foresight and
respond to the need to identify and track medium- and long-term trends. This publication presents
an up-to-date analysis of a selection of key trends.
The Global Trendometer takes a close look at specialist analysis from a variety of reputable sources.
Robust analysis, both of empirical data and of the historical experience, is central to the search for
effective responses to the multiple challenges that are likely to face Europe in coming decades. This
new publication does not offer recommendations, but it does seek to draw attention to relevant
studies and to prompt reflection on how Europe can address future challenges.
The guiding principles of this work are:
 to offer European political decision-makers, and in particular the Members of the European
Parliament, a concise overview of key medium- and long-term trends;
 to underline the complex, cross-sectorial character of many current challenges;
 to analyse trends from a specifically European point of view; and
 to show how perceptions of key trends differ and/or evolve over time.
1 Seneca, L. A. Ad Lucilium Epistulae Morales. LXXI, 3

2 President’s Office, European Parliament (2015, December 17): Speech at the European Council by Martin
Schulz, President of the European Parliament
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The 2015 ESPAS report ‘Global Trends 2030: Can the EU The European Strategy and Policy
meet the challenges ahead?’ was the first document of its Analysis System (ESPAS)
kind with a specifically European point of view. This is
a fundamental reference and starting-point for the new ESPAS aims to strengthen the EU's
collective administrative capacity for
Global Trendometer. foresight. It seeks to identify the main
This inaugural edition includes more detailed analysis of global trends and to provide the decision-
makers of the participating institutions
three trends, one from each of the major categories
with informed, up-to-date analysis of
identified by the 2015 ESPAS report: long-term policy challenges and options.
It is a joint initiative of the European
 Growing scarcity of water world-wide: Apart from
Parliament, the European Commission,
its human impact on the most exposed societies, the Council of the European Union and
water scarcity may lead to conflicts and forced the European External Action Service,
migration. Europe could be affected both directly with the Committee of the Regions and
and indirectly, and faces considerable challenges as the European Economic and Social
Committee as observers.
a result.
 Increasing inequality: Foresight reports repeatedly The 2015 ESPAS publication ’Global
confirm this trend, particularly in the West, and see Trends to 2030: Can the EU meet the
it as a pre-eminent concern. Inequality poses critical challenges ahead?’ summarised major
challenges for the process of European integration, in existing and emerging trends under three
broad categories: i) economic and
social, economic and political terms. technologic change, ii) social and
 US military power in 2030: Changes in the democratic change, iii) geopolitical
technological, political, economic and even social change.
bases of the US could change the global order. What
consequences are there for Europe?
The Global Trendometer then addresses a wider selection of trends in a schematic way, to bring out
uncertainties about their further development and possible disruptions they may provoke. The
chosen trends are: jobless growth; the Asian century; blockchains and trust; additive manufacturing;
intolerance; the mobile internet and democracy; Russia and China and democracy in the Middle
East and North Africa.
As a rule, the issues addressed have deep roots and will have long-term consequences.
Comprehensive solutions will often involve complex and indeed difficult policy packages, and a
great deal of coordination and willingness to compromise across and within Member States, the
European Union and the wider international community.
The choice of a wide selection of topics is quite deliberate. Specialist knowledge in specific areas is
critically important; but there is also a great need to be able to look across sectoral boundaries. This
can help us to identify common challenges and to develop comprehensive and strategically
sophisticated responses. In a period of rapid change, an understanding of the dynamics of different
sectors, and of their interaction, can help us make the most of the opportunities that arise and
minimise the risk of future crises.
Danièle Réchard, Head of Unit
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2. Essays
I. Water Scarcity: an avoidable crisis?
Introduction
Water is essential to human life. Although the earth’s water resources may seem plentiful – with
around 70 percent of our world being covered in water – clean drinking water is quite rare. While
the amount of freshwater has been relatively constant over time, demand has risen at a rapid pace.
Already today, freshwater has become a scarce commodity in some parts of the world, and
projections suggest that global demand will exceed current sustainable supplies by 40 percent in
2030 (World Bank, 2016). By 2050, around four billion people could be living in water scarce areas,
according to the Organisation for Economic Cooperation and Development (OECD, 2008, 2012).
Given this dire outlook, it is no surprise that the World Economic Forum’s (WEF) Global Risk Report
2016 lists water crises amongst the greatest global risks to future stability and growth.
This increase in water demand over the coming decades is expected to be mainly driven by
demographic developments, rising living standards, and higher water needs in the agricultural,
energy and industry sectors. This rising demand is exacerbated by climate change and has to be met
by ever decreasing freshwater reserves. Water scarcity will have severe consequences, not only
affecting individual hygiene and water intake, but also influencing food prices, exacerbating
inequalities and possibly increasing conflict and migration. Europe in particular could be both
directly and indirectly affected, and is facing considerable future challenges.
In light of this worrying trend and its cross-cutting effects, it is of utmost urgency to address the
future effects of growing global water scarcity on a transnational level.
In many ways the issue of water scarcity exemplifies the advantages of a strategic foresight approach
to policy design that favours risk management over crisis management. Water is expected to become
scarce in the future and adversely affect our lives in various ways. The extent and severity of this
effect, however, depends crucially on the investments we make today. As Mogherini put it on World
Water Day 2016: ‘Now is the time for action’.
Definition
Water scarcity usually implies a lack of freshwater. It refers to a situation in which water resources
are unable to adequately satisfy water needs from all sectors within a region. Water scarcity can be
due to physical scarcity (i.e. when water resources are unable to meet demands) or economic
scarcity, where the lack of water is the result of mismanagement or insufficient infrastructure. The
concept is defined in relation to corresponding needs and livelihoods (Dow et. al., 2005, 3), and is
often used in conjunction with water stress, water shortage, water risk, and water crises.
What drives water scarcity?

Demand for water will rise substantially within the next decades, especially as a result of ongoing
population growth. According to World Bank (2016) estimates, the global population may exceed
nine billion in 50 years. Ongoing economic growth and rising incomes lead to an expanding global
middle class (ESPAS, 2015). With countries becoming more prosperous and urbanised over time,
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their water consumption increases. Already within the past century, water use has been growing at
more than twice the rate of population growth (Pontiroli Gobbi, 2012). Forty percent of the
population already suffers from water shortages for at least one month per year. If the current trend
continues, four billion people could be living in water scarce areas by 2050, according to OECD
estimates.
As of today, according to the US National Intelligence Council (NIC, 2012), the agricultural sector
accounts for as much as 70 percent of global water withdrawals. Production will have to increase in
the coming decades in order to feed a growing population. By 2030, demand for food is expected to
increase by around 35 percent (NIC, 2012). Higher incomes are expected to lead to a shift from a
predominantly starch-based to a meat-based diet in many parts of the world, which is considerably
more water-intensive. Whereas growing one kilogram of rice requires 3 500 litres of water,
producing the equivalent amount of beef requires 15 000 litres, according to the UN World Water
Assessment Programme (WWAP, 2015).
In Europe, the industrial sector is one of the main water users, accounting for about 40 percent of
total water consumption (Förster, 2014). Global water demand coming from manufacturing is
projected to increase by 400 percent between 2000 and 2050 (OECD, 2012).The energy sector is
another thirsty business: according to the WEF (2015), Europe currently uses 30 percent of its
freshwater to generate energy. Some new energy sources (such as hydropower or biofuels), although
generally favourable due to their low carbon emissions, can be very water intensive. Paired with the
expected rise in energy demand by about 50 percent in the next 15 to 20 years, energy-related water
consumption is set to increase considerably in the future.
Another pressure is that of water pollution, which can occur through the contamination of water
with fertilisers, urban wastewater or industrial waste. Many of the pollutants can make their way
into underground aquifers. Unsafe water conservation and storage often also increases the risk of
contamination and the spread of diseases.
Climate change is expected to exacerbate future water shortages. On the one hand, precipitation
patterns will change and become more concentrated, with wet areas becoming wetter and dry areas
drier. In some countries in the Middle East and Northern Africa, precipitation is forecast to decline
by up to 15 percent (NIC, 2012). On the other hand, extreme weather events, such as floods,
droughts, high waters and heat waves are forecast to become more frequent and destructive,
increasing risks and vulnerabilities (Pontiroli Gobbi, 2012). Small glaciers are expected to disappear
within the coming decades in some regions – a vital source of freshwater for millions of people
during dry seasons.
The problem is not just the availability but also the distribution of water. As the World Bank (2016)
puts it:
Climate change is not expected to alter global supplies. Instead, the challenges are regional, due to the
uneven distribution of water, and economic, due to poor management of water resources. Without
substantial reforms, water-related shocks and trends will converge to produce growing scarcity in
some regions of the world and growing excess in others. (p. 10)
Overall, the issue of growing water scarcity is one of increasing demand (through an explosive
population growth, increasing need for agriculture, and higher rates of water consumption) met by
a shrinking, unevenly distributed supply, and a continuous depletion of freshwater sources.
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What are the effects of water scarcity?

With freshwater being essential for human life, a lack thereof would have considerable adverse
consequences. Thirst, already an issue in many of the most affected countries, would become a
worrying trend, especially amongst the poorest members of the population. Water scarcity does not
only affect drinking, but also hygiene and thus the spread of diseases, either directly through a lack
of available water or through unsafe storing conditions that increase the risk of infection (WEF,
2016).
From a macroeconomic perspective, rising water scarcity and increasing competition for water
would harm the global economy. The estimated 55 percent rise in water demand between 2000 and
2050 will be primarily driven by increases in manufacturing and electricity (OECD, 2012). ‘Economic
growth is a surprisingly thirsty business’, with productivity and performance closely tied to water
availability (World Bank, 2016, p. 1). Future water shortages could therefore have strong
implications for the global economy and lead to periods of negative economic growth. In countries
most strongly affected by water scarcity, the World Bank (2016) predicts GDP growth rates to decline
by up to six percent by 2050.
As the agricultural industry is responsible for most of the annual freshwater withdrawals, reduced
water availability could lead to strong increases in food prices and food shortages. A spike in food
prices would especially disadvantage the poor, who spend a larger share of their income on food.
This could exacerbate existing inequalities and ‘fuel social discontent over other economic issues
such as low wages and poor governance’ (NIC, 2012, p. 34). Eventually, these developments could
contribute to growing state fragility in arid regions of the world, with long-term cross-sectional
implications. State fragility in turn hampers governmental capacity for effective water allocation,
potentially increasing shortages.
There is some disagreement over whether water shortage per se will increase conflict between
countries. A report by the Strategic Foresight Group (2013) claims that a lack of water cooperation
among countries sharing trans-boundary river basins exacerbates their risk of war3. The World Bank
(2016), however, claims that even in the future, war between countries over water alone remains
unlikely. Inter-community tensions may nevertheless grow as a result of water shortages. Already,
evidence suggests that ‘[e]pisodes of droughts and floods are often followed by spikes in violence,
civil war, and regime change in developing countries’ (World Bank, 2016, p. 19). Still, it may be
premature to argue that ecological degradation alone increases the likelihood of violence – there
have been many instances where, instead of sparking war, water crises have initiated co-operation
amongst previously hostile countries (Bauer, 2007).
With ongoing global warming, increasingly frequent extreme weather events and rising water
scarcity, the term ’environmental migrants’ is increasingly salient in contemporary debates4. Floods,
droughts and other weather events could lead to large-scale demographic responses and encourage
migration to less affected countries. It is hard to measure exactly whether environmental factors and
lack of water are the primary reasons that make people migrate, due to the interrelation with
political and economic concerns. Nevertheless, bad water quality and desertification are expected to
be among the most important concerns driving future population movements.
3 Hsiang et. al. (2013) similarly find that changes towards warmer temperatures and more extreme
precipitation patterns systematically increase the probability of conflict between countries.
4 Norman Myers, an environmental analyst from the University of Oxford, estimates that climate change
refugees will amount to 150 to 200 million people by 2050 – a figure commonly cited by the IPCC (Brown,
2008, p. 11) and the Stern Review on the Economics of Climate Change (Stern et al, 2006).
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What does this mean for the EU?

Europe will be both directly and indirectly affected by growing global water scarcity. According to
the European Commission (EC; 2016) ‘water is no longer the problem of a few regions, but now
concerns all 500 million Europeans’. About half of the EU’s river basins will be directly affected by
water scarcity and stress by 2030 (EC, 2012, see also EEA, 2015). The strongest impacts will be in
highly urbanised, densely populated coastal regions and in Southern Europe, and could adversely
affect tourism, agriculture, industry, energy and transport sectors (EC, 2007).
Compared to other regions, the EU will most likely be spared from the worst direct effects of water
scarcity. However, many of the issues outlined above can have adverse indirect effects. Already, we
see that disputes over ownership and usage of water give rise to tensions that are expected to
increase as time goes on. Conflicts and state fragility often stretch beyond regional boundaries,
affecting the global economy, increasing security concerns and altering migration patterns. Some
argue that, besides conflict, water scarcity in Syria has been one of the key factors driving the recent
migration wave to Europe (e.g., van der Heiijden et. al., 2015). According to the North Atlantic
Treaty Organization (NATO, 2013), 40 countries in the Middle East and in Africa will suffer from
insufficient water access by 2025. Environmental degradation and water scarcity could therefore
further increase migration to Europe.
The importance of water management policies

Adequate and efficient water management can mitigate much of the costs of water scarcity.
According to economic models by the World Bank (2016), inadequate water management policies
can exacerbate the negative impact of water scarcity on economic growth, ‘while good policies can
go a long way towards neutralising them’ (p. 1). In some countries, economic growth levels could
even increase significantly in response to more reliable water infrastructure.
There is already international awareness surrounding the importance of water for the future; the
United Nations recently included the ‘availability and sustainable management of water for all’ as
one of their 17 Social Development Goal (SDG) to 2030. Awareness now has to be followed by action.
The main policy recommendations of key publications on how to avoid water scarcity are
summarised below. All organisations agree that the consequences of inaction will be severe, and
that today’s investment in water will yield large benefits for the future.
World Bank (2016) High and Dry: Climate Change, Water and the Economy
In its report, the World Bank proposes three overarching policy priorities to help establish water
security and a climate-resistant economy. First, a better and more efficient allocation of scarce water
resources within and across sectors through better planning, regulation and water pricing. Secondly,
investing in storage infrastructure, water distribution and recycling will go a long way to expand
water supply and availability. Leaks in distribution networks account for a significant amount of
yearly water loss. Finally, it is necessary to build resilient economies in order to reduce the impact
of extreme weather changes, climate uncertainty and precipitation variability.
World Economic Forum (2016) Global Risk Report 2016

The WEF addresses the devastating impact of water shortage on food supply in countries most
exposed to climate change. To maintain food security in the years to come it is necessary to adapt
agricultural methods to future water supplies, address food wastage, improve water distribution
and increasing storage capacities. The report also stresses the need for private-public partnership,
focusing on 1) improving big data processing to develop early warning mechanisms, 2) facilitating
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insurance programmes protecting small farmers against variations in yields and income, and 3)
encouraging climate-resilient investments.
Organisation for Economic Co-operation and Development (2012) Environmental Outlook to 2050:
The Consequences of Inaction
The OECD calls for determined strategies that ensure coherence between ‘water policy’ and other
policy areas, and emphasises the need to prevent tensions over trans-boundary water sources. It
recommends a mixture of policies that combine adequate water pricing with investments in
wastewater collection technologies and water storage capacities. Improving water supply and
sanitation infrastructure in developing countries will help mitigate the risk of water-related
disasters. The OECD advocates an increase in the proportion of official aid dedicated to water issues
by its member states, but also, like the WEF, highlights the importance of the private sector.
National Intelligence Council (2012) Global Trends to 2030: Alternative Worlds

The NIC calls for investment in new technologies and agricultural efficiency to prevent food and
water shortages. In many parts of the world, agricultural progress could be made by investing in
seeds and fertilisers, and by making better use of irrigated land, which would take high amounts of
pressure of existing water resources. Export controls should be introduced with caution, as they may
exacerbate food shortages in other parts of the world.
Conclusion
With each new day, competition over scarce water resources increases. Water scarcity is expected to
pose a severe challenge for the future, driven by population and economic growth, and exacerbated
by climate change. Because of its essential role in almost all sectors, a lack of water would have far-
reaching and diverse consequences, affecting, amongst others, the global economy, food security
and migration patterns. The time to act is now – adequate water-management policies can still
mitigate many of the future concerns and help alleviate the future costs of water scarcity. The EU is
already at the forefront of ensuring water security, both internally (e.g., 2000 Water Framework
Directive) and on a multilateral level, repeatedly highlighting the importance of water supply,
sanitation and water diplomacy. An EPRS ‘Cost of Non Europe’ Report (Zandstra, 2015) on water
legislation shows that, if fully implemented, existing legislation could already generate financial
benefits of around €28 billion per year for the EU. Given the dismal forecasts by lead publications,
however, many further steps need to be taken in order to secure sustainable water supply in the
decades to come.
By Danièle Réchard with Arun Frey
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II. Increasing inequality: from a social and political challenge to an

economic problem?
Summary
This essay analyses the trend towards greater inequality as considered in recent foresight reports,
with a focus on how perceptions of this trend are evolving. It examines in turn the economic, social
and political challenges linked to inequality. It then addresses policy options for the EU in the face
of a significant barrier to economic and social progress and to continued European integration.
Background
Authoritative foresight reports concur that economic inequality is a major trend. As the ESPAS
report (2015) puts it, ‘growing inequalities pose a major political, social and economic risk in the
years to come’ (p. 21). The WEF’s current Global Risks Report (2016) states that ‘excessive inequality
lowers aggregate demand and threatens social stability, and can increase risks such as involuntary
migration or terrorism caused by violent extremism. Rising inequality is also correlated to upticks
in security problems, such as violent deaths or robbery’ (p. 20). The OECD (2014) reports that income
inequality has increased in the vast majority of OECD countries (p. 18). NATO (2015, p. 20ff) has
now added inequality to its list of emerging trends - a further example of the greater priority being
given to the problem.
Taken as a whole, these reports also show that perceptions of this trend are changing. First,
consensus on the reality of growing economic inequality has strengthened. Second, while it has long
been accepted that inequality increases the risk of social and political instability, it is now recognised
that inequality is also in itself an obstacle to economic growth (Ostry, 2014; OECD, 2016). This adds
urgency to the search for effective policy responses.
Economic challenges linked to growing inequality

There is a strong consensus that economic inequality is increasing, and that this is a long-running
trend from the 1980s. Income inequality is easier to measure than other forms of inequality, and the
relevant data has been extensively analysed in recent years. Figure 1 presents trends in income
inequality between 2000 and 2014 in the 28 EU countries. This shows a general pattern of
redistribution upwards: the income share of the top 20% (quintile) increased relative to that of the
bottom 20% in most, though not in all countries. OECD data shows that the ratio of the income share
of the top 10% to the bottom 10% rose from 7:1 in 1985 to 10:1 at present.
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Figure 1
The effect of inequality on growth has been extensively researched and debated. While the reported
empirical findings are inconsistent (Voitchovsky, 2011, p. 569), a recent OECD report (2016) finds
that ‘higher inequality drags down economic growth and harms opportunities,’ (p. 15). A European
Parliament committee hearing was told that ‘economies that have greater inequality have lower
growth, and this is a causal effect’ (Pearson, 2016).
The relation between inequality and growth is nevertheless complex. Tax and transfer strategies to
mitigate inequality may themselves harm economic growth, if misused (OECD, 2014). The option of
doing nothing is comprehensively challenged by the work of Thomas Picketty (2013), who
contradicts the traditional analysis that the trend towards inequality reverses itself over time. Stiglitz
(2012) points out that rising inequality cannot be dismissed as ‘the inexorable workings of the market
economy’ (p. 333). A reassessment review of historical evidence presented in an International
Monetary Fund (IMF) discussion paper concludes that ‘lower net inequality is robustly correlated
with faster and more durable growth, for a given level of redistribution’ (Ostry, 2014, p. 4).
Tax fairness
Tax fairness has emerged recently as a major strand of the inequality debate. Luxleaks, the Panama
Papers, and studies of the dimensions of corporate tax avoidance have brought the issue into sharp
focus. Zucman (2015; table 1 below) estimates the cost to countries of wealth being held offshore at
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over €200 billion. The ease with which companies can relocate to places offering more favourable
tax regimes adds to popular concerns about the negative side of globalisation.
Table 1
Wealth held offshore and tax revenue loss, by region
Offshore wealth Share of financial Tax revenue loss
(US$ bn) wealth held offshore (US$ bn)
Europe 2 600 10% 75
USA 1 200 4% 36
Asia 1 300 4% 35
Latin America 700 22% 21
Africa 500 30% 15
Canada 300 9% 6
Russia 200 50% 1
Gulf countries 800 57% 0
Total 7 600 8.0% 190
Source: Gabriel Zucman, The Hidden Wealth of Nations - The Scourge of Tax Havens
The fact that the tax share of corporations and high net worth individuals has lagged compared to
the tax share of the bulk of the population is a particular concern in view of the prospect of a looming
funding gap for welfare programmes. It is easy to understand a clamour for a concerted effort
against large-scale tax avoidance.
Success in resolving this issue depends on cooperation between countries, not just at EU level but
globally, as acknowledged by the Global Declaration against Corruption (2016) adopted at the
London Anti-Corruption Summit in May 2016.
Impact of technological change

There is considerable concern about the consequences of the rapid technological change the world
is currently experiencing. ‘Some inequalities are being compounded by the current technological
and industrial revolution. The possibility of mass unemployment linked to the emergence of new
technologies is perfectly plausible’ (ESPAS, 2015, p. 61; see chapter 3/I below).
Social challenges linked to growing inequality

The negative social consequences of greater inequality have been analysed in detail, for example by
Wilkinson and Pickett (2009). They present a considerable body of evidence showing a close
association between greater inequality and worse overall outcomes in health (including obesity,
mental health, and life expectancy), educational performance, crime (including violent crime) and
social mobility.
Other trends may exacerbate inequality. Demographic developments in Europe point to an increase
in retired people, and a fall in the ratio of those contributing taxes to those receiving social assistance.
This in turn points to a scenario of relatively better off pensioners on the one side, and workers
facing an increased tax-burden on the other.
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It is also known that ‘growing inequalities pose an additional challenge for the sustainability of
European social protection policies’ (ESPAS, 2015, p. 62). The ESPAS report suggests that ‘more
efficient social safety nets are needed to underpin market flexibility and combat rising inequality’
(p. 77). One implication is that increased social assistance costs will create additional budgetary
pressures. This leads to the dilemma of finding additional funding for social expenditure, for
example through greater taxation, or alternatively reducing entitlements and ending programmes
considered ineffective.
It is clear that there is a correlation between stable societies, with good economic performance, and
those with stronger welfare provisions and lower levels of inequality. The Nordic countries are the
stand-out examples of this.
Political challenges linked to growing inequality

The impact of inequality on political systems is readily apparent. ESPAS (2015, p. 77) noted that
inequalities affected the EU’s cohesion and undermined its economic strength. The IMF (2016),
among many others, sees a link between inequality and a more inward, less internationalist political
tone: ‘the causes are complex but certainly reflect growing income inequality as well as structural
shifts, some connected with globalization, that are seen as having favoured economic elites while
leaving others behind’ (p. xiii). Some commentators see inequality as a significant factor in the result
of the UK’s EU referendum (Goodwin, 2016). Of course, perceived unfairness in economic status is
not a new phenomenon: Aristotle identified this as a factor in the political turmoil of Athens in his
day (Ryan 2012, p. 100ff).
At a certain point, rampant inequality can become an existential threat to democracy, and large scale
social conflict becomes a plausible scenario. There is now greater recognition of the possibility that
greater inequality can ultimately undermine national security, as illustrated by the addition of
inequality to NATO’s list of key emerging trends.
On the international front, some have drawn comfort from the indications that globalisation is
reducing inequalities between developed and developing countries, notably due to the rise of India
and China (ESPAS, 2015, p. 21). Bill Gates has also emphasised this point (Muggeridge, 2016).
Although inequality within emerging economies has been reduced, this has come about against a
background of extremely high levels at the outset. A key measure of inequality in the distribution
of family income, the Gini coefficient, remains higher for emerging economies than for most
European countries.
Policy options
Combatting increased inequality calls for measures reaching across many policy areas. The literature
reviewed above stresses the importance of skills and education, women’s participation in economic
life, and tax and transfer systems which allow efficient redistribution. Labour market measures are
also part of the solution.
On education, there is strong consensus that this sector plays a crucial role. The OECD (2016) points
out that ‘inequality has a negative impact on growth through the channel of human capital: the
wider is income inequality, the lower is the chance that low-income households invest in education’
(p. 60). A RAND report (Hoorens, 2013) for ESPAS notes that high levels of inequality in educational
attainment are associated with higher income inequality. Machin (2011) confirms that ‘there is now
a broad consensus on the issue of the existence of positive economic returns to education’ (p. 426).
PE 573.301 16
As the OECD (2014) notes, ‘further improvements in educational attainment levels can support
equity and growth’ (p. 47). Yet there is no automatic mechanism leading from education to less
inequality. ‘Under certain circumstances education can provide the route out of disadvantage [...] In
other circumstances education reinforces already inexistent inequalities and can result in increased
inequality [...] education has been becoming more important for labour market outcomes and those
left behind ... are penalised more heavily’. A key interim step is ‘to devote resources towards
increased and improved skill formation’ (Machin, 2011, p. 426-7).
On the relation between gender equality and income disparities, OECD (2016, p. 211) research shows
that an increase in the proportion of households with women working full-time over the past
decades has had the effect of countering the trend for income inequality to increase. Given that
‘increasing participation of women in the labour force has a significant effect on economic growth,’
the OECD (2016) concludes that ‘policies to increase the earnings potential of low-earning women
are needed to further strengthen the effort’ (p. 210).
As regards taxation, there is consensus on the importance of reform of tax systems and practice
(OECD, 2012). Paradoxically, inequality can impede growth if it calls forth the wrong redistribution
strategies – the treatment can be worse than the disease. But redistribution generally appears to have
a benign impact on growth; only in extreme cases is there evidence to suggest a negative effect on
growth (Ostry, 2011, p. 4). For the OECD, the remedy includes reforms to ensure that the wealthier
pay their fair share, also by improving tax compliance and by closing tax loopholes. A reassessment
of the role of taxes on wealth, including on the transfer of assets, is also needed (OECD, 2016, p. 79).
Initiatives promoting tax fairness require improved tracking of data to uncover non-compliance, as
well as enhanced sharing of data across national boundaries. This also calls for the allocation of
sufficient resources to do the job.
On the global challenge of large intercontinental prosperity gaps, which remain a key driver of mass
migrations, strong and coordinated international efforts are needed. It remains important to protect
the framework allowing international trade, which is still a major contributor to prosperity
nationally and internationally.
On the labour market, the spread of non-standard jobs in what has been termed the gig economy is
seen as an important driver of income inequality (OECD, 2016, p. 136). Reduced job security is
associated with increased income inequality. It follows that the long-standing emphasis on
structural improvements should not be interpreted as a mandate to loosen labour market conditions,
if the outcome is greater reliance on non-standard work. At the same time, there are indications that
further digitisation and technological innovation will have a major impact on many jobs. Strategic
planning is needed to forestall the threat of a sharp and lasting rise in unemployment.
Perceptions about the trend towards increased inequality and the steps needed to mitigate it have
evolved considerably in the past decade, and this has also involved a reassessment of economic data.
Continued robust analysis, both of empirical data and of the historical experience, is essential to
inform policy in the coming years. We do not have all the answers to the problem of increasing
inequality; we are at a frontier of knowledge, and one which needs to be pushed forward.
Concluding remarks
One prognosis is that ’while material conditions for most people are likely to improve over the next
30 years, the gap between rich and poor is likely to increase‘ (NATO, 2015, p. 21). Increasing
inequality poses complex challenges, with economic, social and geopolitical dimensions. A strategy
to mitigate it will involve initiatives across many different policy areas. There is a need for broad
agreement on the division of labour, burden sharing and distribution of competences across EU
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institutions, Member States, and other relevant bodies. This brings the focus around to improved
governance, better policy coherence and better policy efficiency, and to three elements highlighted
by the OECD Productivity and Inclusiveness Nexus:
 Improved capacity for joined-up action
 Reinforced institutional structures, and
 Improved international (and inter-instance) cooperation.
Without active counter-measures, the likelihood is that economic inequality will continue to
increase, and its impact will become increasingly serious. A key takeaway of the ESPAS (2015) report
remains valid: ’the search for a better balance between inequality, redistribution and growth will
continue to shape the political agenda‘(p. 51).
By Eamonn Noonan
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III. Foundations of US military power in 2030: leading from the front or

from behind?
Introduction
Today, after the cold war struggle for military supremacy and the period of undisputed military
dominance, the United States has to cope with changing global circumstances and to confront
formidable challengers. In response to this situation, the USA has recently started to work on what
it calls the ‘third offset strategy’, a research programme on new technology and its use in the
military.
This essay portrays the possible and probable long-term future of the technological, political,
economic and social foundations of US military power5, in order to better understand likely shifts
in global foreign policy, changes in US self-perception and new policy challenges for Europe.6
Past US military dominance

Since the start of the Cold War, the United States founded much of its strategic military power on
technological superiority (Work, 2015), in order to ‘compensate or offset the numerical advantages’7
(Brimley, 2014, para. 6) of the Soviet or the Chinese armies. Through strategies now called the first
and second offset, the US developed robust nuclear deterrents in the fifties, and microelectronics
and IT in the seventies and eighties. The products of this second offset - called the ‘Revolution in
Military Affairs’ (RMA; Ibrügger, 1998) and consisting of ‘networked precision strike, stealth and
surveillance for conventional forces’ (Hagel, 2014, p. 2) - made the United States military of the 1990s
and 2000s unrivalled on a conventional battlefield. In particular, guided munitions allowed it to
engage any enemy with deadly precision from a safe distance. The Gulf War of 1991 proved to all
strategic challengers of US military power - competing countries as well as non-state actors, such as
terrorists - that they would not be able to compete in a conventional war with the West.
Technological superiority was not the only aspect of US military power during the Cold War.
Equally important were factors involving democratic control over armed forces, international reach,
economic and industrial strength, an effective education system, high trust in the armed forces, and
the sufficient quantity and quality of recruits.8
5 Military power is difficult to define. Experts argue over what is more important, the material, political and
economic basis for armed forces — e.g. the renowned economic argument in Paul Kennedy’s ‘Rise and Fall
of Nations’ — or their effectiveness in deploying and fighting — e.g. Stephen Biddle’s ‘Military Power:
Explaining Victory and Defeat in Modern Battle’. Here we focus on the first view, analysing the long-term
changes in the political, economic, social and technological foundations of US military power. By focusing
on the future of military power, we necessarily need to limit the discussion on the future of US foreign
policy, cultural strength or the evolution of alliances.
Main sources on future issues are the following foresight reports: The EU Institute for Security Studies’
(EUISS) ‘Envisioning European Defence’ report (Andersson et al., 2016) and ‘Arab Futures, three scenarios
for 2025’ (Gaub & Laban, 2015); NATO’s ‘Strategic Foresight Analysis 2015 Interim Update’ (NATO, 2015);
the UK Ministry of Defence’s Development, Concepts and Doctrine Centre (DCDC) ‘Future Operating
Environment 2035’ (U.K. MoD, 2015); Global systems on a brink: Pathways toward a new normal (Burrows
& Dynkin, 2015) by the Atlantic Council and the Institute of World Economy and International Relations
of the Russian Academy of Sciences (IMEMO) and ‘Global Trends to 2030’ (ESPAS, 2015), but also selected
political analysis, official statements and documents.
7 And, to a lesser extent proximity to probable areas of operations.
8 Discussing the relative importance of these forces in US history is beyond the scope of this paper.
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The present - a mixed picture

Many of these factors behind US military primacy have eroded:
The results of the second offset wear off. Due to the effects of the 1991 Gulf War, the main challengers
of the United States found alternative ways to deter the sole remaining superpower from being too
active in their immediate areas of interest. In the 2000s, these strategies gave way to more
conventional military strategies, including copies of RMA and effective but cheap weapons such as
intermediate range missile systems and Improvised Explosive Devices (IEDs).
After an initial period of deterring the USA mainly through non-military means (e.g. notion of
unrestricted warfare [Barno & Bensahel, 2016], offensive cyber capabilities, influence over global
trade and finance), China gradually complemented this approach with military means, by denying
the USA the possibility to safely access the South and East China Sea. This so-called area-denial and
anti-access-, or AD/A2-Strategy (Freier, 2012, compare with: Haas, 2016), focuses on endangering
the US military with standoff weapons - mainly missiles - which make operating inside the East and
South China Sea very dangerous. This meant that any country coming to the aid of Japan, Taiwan
or Korea in a regional conflict would have to anticipate heavy casualties. In particular, bases, aircraft
carriers and aircraft became more vulnerable to guided missiles.
Russia in the 1990s relied on strategic nuclear deterrence (Trenin, 2016), but started in the 2000s to
reform its armed forces (Gressel, 2015). In addition, it developed new ways to secure influence in
the near abroad through an aggressive and difficult-to-respond-to ‘hybrid war’ strategy (Russell,
2015; see also: Whitmore, 2015).
Finally, global jihadism under Al-Qaeda in the 1990s developed its approach of spectacular terrorist
attacks, because it could not attack the USA and its allies directly. Now, ISIS tries to conventionally
fight its way to a caliphate. Terrorist tactics and extreme brutality are means in a conventional war
which are intended to deter western ground forces, recruit fighters and weaken enemy morale
(Cronin, 2015).
In addition, the second offset has led to adverse effects. As US Lt.Gen. H.R. McMaster (2015) noted:
Advocates of what became the orthodoxy of the “revolution in military affairs”, or RMA, predicted
that advances in surveillance, communications, and information technologies, combined with
precision strike weapons, would overwhelm any opponent and deliver fast, cheap, and efficient
victories. War was reduced to a targeting exercise. These conceits complicated efforts in Afghanistan
and Iraq as unrealistic and underdeveloped war plans confronted unanticipated and under-appreciated
political realities (p. 7).
In the last years, the USA has seemed to disengage from the rest of the world. President Obama has
just ended 15 years of fighting polarising wars. After the economic crisis, US citizens prefer their
government to deal with national challenges such as inequality and migration (Pew Research
Center, 2016). There is talk of diminishing interest and capability of the US to act as a ‘global
policeman’ (Kagan, 2014; Allin & Jones 2012). Allies, be it NATO, Japan or Saudi Arabia, question
the US commitment.
This comes at a time of rising authoritarian assertiveness on the part of actors who seem to be faster
in catching up on military technology, more ruthless in researching issues bordering on the unethical
and in using new technological advances, and generally less risk averse in the use of violent means.
Finally, nation states in general seem to be lagging behind in agility and adaptability when faced
with new types of actors, especially networks, be they real or virtual.
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US defence and R&D spending is lower than it was during the heights of the Cold War. It remains
very significant, however, and will most likely stay so, if there is no paradigmatic change in the US
foreign policy strategy (Walker, 2014). Nevertheless, the economic strength of the US declines in
comparison to China.
Democratisation and globalisation of information and, more specifically, proliferation of defence-
related knowledge, works in favour of less developed nations. Inventors experience more difficulty
in keeping knowledge compartmentalised and countries such as China have professionalised the
activities of intellectual copying and industrial mimicking. This also makes the development of
weapons by copycats much cheaper than for the USA or Europe (Alexander, 2013).
Social trends seem to be the only ones in the United States’ favour: Trust in the US military is still
very high (Pew Research Center, 2013) and a good education and the free flow of ideas still provide
the basis for military performance and adaptation through research (McMaster, 2015).
US response to challengers and changing trends

The US responses to the challengers were the ‘Pivot to Asia’, a combination of diplomacy and
deterrence countering Russia and the so-called war against terrorism. Numerous policies to counter
the political, economic and social trends brought mixed results.
In order to counter the turning of the tide in the technological area, in 2014 the current US
administration, along with most of the defence community (industry, academia, think tanks etc.)
started to push for a third offset in the realms of artificial intelligence, autonomous systems and
robotics (Pavluk & Cole, 2016). This involves investing in new scientific breakthroughs, applied
technologies and corresponding changes in the military.
The current debate among American experts on this third offset is well summarised by Bialos and
Koehl (2016), when they ask: ‘Is the US qualitative edge over its adversaries really eroding? Is a
sustained offset realistic at all? Is Russia that important in considering the future U.S. forces? Are
autonomy and AI really the most important technologies? Is an offset strategy useful that is geared
for a likely conflict against a big power, considering that the US regularly fights irregular conflicts?’
The future - trends and uncertainties regarding the foundations of US military power
Geopolitical Future
All foresight report explicitly mentioning the military strength of the USA (ESPAS, 2015; NATO,
2015; DCDC, 2015) conclude that by 2030 (and 2035) the United States will still be the world’s leading
military power. According to DCDC (p. 2), the US and China will ‘have the capability to dictate
global events and potentially challenge world power’ and China will be the second most single
powerful country. According to Stratford (2016), China’s military rise depends on two factors: the
date of the eventual end of China’s high-growth era, and the ultimate dominance of one of two
narratives: aggressive Chinese nationalism or trust in civilisational and commercial pull, with a
defensive military posture and conservative grand strategy.
If Russia does not come up with an alternative way to finance its ever more capable, but expensive,
military, this could erode the social contract between the leaders and the population, leading to
instability (Trenin, 2016). Thus, although Russia might be more powerful than at any time after the
Cold War, this trend is unlikely to continue to 2030 (see below: chapter 3/VII).
Finally, global jihadism will most probably endure until 2030, even if there is a considerable
likelihood that ISIS will be defeated and replaced by some other form of violent organisation. One
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major disruption ending violent jihadism could be the rise of electoral Islamism (Gaub & Laban,
2015; see below: chapter 3/VIII). Expanding cyber space, difficult urban environments and
globalisation will make it possible for all kinds of terrorist groups to survive and prosper, despite
potential means of surveillance becoming more and more powerful.
As shown by the ongoing debate of neoconservatives around Robert Kagan (2014) and his realist
sceptics (Switzer, 2014), the US foreign policy elite is split on the question as to whether US power
decline is the result of political will, and therefore possibly reversible, or a given fact that needs to
be managed. Depending on the position of the next administration in this debate, the in-coming
president might discontinue or expand the expensive strategy of the third offset.
US military power would also be severely endangered, if by some disruption, ‘US capacity would
be stretched to the breaking point’ (Burrows & Dynkin, 2015, p. 5). This instability could be created
through home-made isolationism, China finding enough partners (e.g. BRICS) in an aggressive
campaign for a parallel non-western order, or NATO being unable to continue as an effective
alliance.
Withstanding US continued leadership, all foresight studies analysed for this essay stress the
importance of a growing multipolarity in international relations. No matter if they base their finding
on the decline of the US and the strength of Asia, or the many trends that build a more globalised
and therefore decentralised world, the future will include many more political actors that have
considerable power over global questions. As NATO (2015, p. 7) recaps, ‘historically, major power
shifts between states and regions occur infrequently and are rarely peaceful’ (Allison, 2015) and ‘in
a polycentric world, this set of rules (and international norms) will be less evident and more
contested, resulting in a need for dialogue and negotiation’ (p. 8). This trend might limit military
action in the future or lead to many small military conflicts with changing coalitions and the higher
risk of big power conflict. Key uncertainties will be the reform of globalised regimes like the UN,
the future of stabilising powers like India, the global rise in aggressive nationalism and
protectionism and a possible alliance between Russia and China (See below: chapter 3/VII).
Although most arguments for the long-term global implementation of democracy are still valid, for
the medium term, democracy as a ‘brand’ has difficulties, especially due to theocratic and
authoritarian challengers. NATO (2013; 2015) has downgraded its positive projections of a gradual
transition towards democracy from 2013 to 2015. It is uncertain, if democracies like the USA and its
allies can go through difficult reform processes and at the same time prevail against autocratic and
totalitarian challengers.
DCDC (2015, p. 13) reports state that the nation state and national armed forces will remain the
central actor in 2030, but that a wide range of non-state actors - global opinion leaders, companies,
international organisations, political movements, organised crime and terrorism - will be more
important and that lines separating these groups will become blurred. The dwindling power of the
nation state is creating a backlash in many countries. ‘The loss of national sovereignty is a growing
battle cry for those opposed to globalisation’ (Burrows & Dynkin, 2015, p. 4).
Economic Future
Regarding the economic foundation of the US, the ESPAS report (2015) notes that ‘an ‘economic G3’
— United States, China and the European Union — will dominate, with China expected to rise to
first place’ (p. 23f; see below: chapter 3/II).
The future of defence innovation will be heavily influenced by commerce, highlighting the need for
more and novel forms of cooperation and sharing between the public and private sector. Current
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drone innovations reveal cycles of military and civilian innovation. While the military cracked the
massive costs of initial research, civilian research excelled in miniaturisation and scaling production.
As the rate of technological change accelerates, defence production will have to cope with the
problem of ever-increasing costs, shorter life cycles and more adaptive opponents.
In particular, the rising cost of armaments, with weapon programmes like the F-35 and the new 97
billion US-dollar strategic submarine replacement, is becoming increasingly unbearable for the USA
(Majumdar, 2016). Here, the main trend is internationalisation of weapons research. A disruption
could be the evolution of swarming, where many cheap automated weapons overcome expensive
ones.
Regarding the effectiveness of state sponsored research, the third offset just might be the project to
prove or disprove Mariana Mazzucato’s (2015; Wolf, 2013) notion that states are the most efficient
funders of game-changing technology, especially dual use goods.
Technological Future
The world will be much smaller in 2030, especially in terms of information and knowledge.
Proprietary knowledge might be nearly impossible in the long run. The more the internet of things
and additive manufacturing (see below: chapter 3/IV) become available, the more cheap choices of
weapons will be available for groups and individuals. At the same time, weaker states and
sophisticated non-state actors might have the knowledge necessary to develop weapons of mass
destruction and the relevant guided delivery systems. Nuclear weapons might become a ‘weapon
of the poor’, ‘used against adversaries’ superior conventional forces’ (Burrows & Dynkin, 2015, p. 9)
with the risk of immediate escalation. The cycle of ever more spectacular attacks might make
terrorist groups prioritise such means (DCDC, 2015, p. 12).
As mentioned earlier, AD/A2 capabilities will be an important feature of the current, and possibly
also future, arsenal of opponents of the USA. The DCDC (2015) report lists, inter alia, anti-ship,
conventional and nuclear ballistic missiles, loiter-capable, automated systems (including
submarines) and weapons of mass destruction.
According to the same report, more advanced nations will also focus on anti-satellite weapons and
high-altitude platforms, while the less advanced will focus on professionalising the use of proxy
warfare and state-sponsored terrorism. On the modern battlefield, western armies will encounter
intelligent mines and guided munitions, directed energy and electromagnetic weapons and
swarming and automated weapons of all sorts. Also important will be advances in nano-technology
and advances in improving the body and mind internally or externally.
Highly developed ‘western’ armies will counter with many of the same trends: automation of all
kinds of physical and cyber systems, intelligent, real-time big data analysis, communication and
control, autonomous disruption of enemy networks through offensive electronic warfare and cyber
capabilities, and new ways of engaging enemies with even more precision.
Regarding all things cyber, the reports analysed vary when it comes to the importance of dangers
and potential. Much will depend on future vulnerabilities, the realisation of the internet of things
and possible (international) control and verification. In robotics, autonomous systems and artificial
intelligence, it depends on how fast the technologies will develop, how cheap they will be as weapon
systems, and if potential arms races can be avoided. The Munich security conference report (2016)
highlights the potential for these weapons in subduing civilian populations and lowering the
threshold of conflict. Unlikely but paradigmatic breakthroughs would be quantum computing,
defensive weapons rendering (even hypersonic) missiles useless and leaps in artificial intelligence.
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Social Future
The most important social uncertainties are war weariness and the future of political participation.
As a result of inter alia the middle-eastern wars, this generation (similar to the post-Vietnam
generation) is very divided on the use of military force in international conflicts; influences in the
next generation are unclear (Pew Research Center, 2016). The future impact of social media in
security politics (see below: chapter 3/VI) is also unclear. On the one side it replaces expert
journalism scrutinising the military, but on the other side it provides new actors to participate in the
political discourse.
Europe and the decline in US military power in 2030 - So what?

‘The EU’s Common Security and Defence Policy is mainly limited to relatively small, short-lived
and low-end crisis management missions and operations in third countries (and) suffers from a lack
of commitment and a lack of resources’ (Andersson et al., 2016, p. 5). Current crises might change
this, but they also shift attention to NATO. The next years will be very important and might lead to
either a permanently reduced or even suspended role, or various forms of common action
(Andersson et al., 2016).
According to a study commissioned for the European Parliament (Mauro & Thoma, 2016, p. 7),
defence research in the EU has ‘declined sharply since 2006. Between 2006 and 2013, European
Defence Agency countries’ R&D has been reduced by a staggering 29.2 %, from EUR 9.7 billion to
EUR 7.8 (...) twice the rate of defence expenditure (14.7%)’.
Still, in 2030, most foresight studies predict that the EU is ‘likely to continue to play a greater security
and defence role’ (DCDC, 2015, p. 13). This could happen inside or outside the existing treaty
framework (Andersson et al., 2016, p. 6). The EU will probably still be a relatively weak security
actor compared to the USA, Russia or China, not for want of military power, where it will likely be
second or third behind China, but because of a lack of effective defence coordination, and of
coherence, decisiveness and interest in global security issues. Without positive changes emanating
from Russia, the European neighbourhood will be more unstable.
Regarding the third offset, defence experts such as as Daniel Fiott (2016) ask how it might affect
European capability development and if it could ‘also create a larger technological gap between
NATO states?’ In addition, Luis Simon in The Journal of Strategic Studies (2016) asked if Europe
might need an offset strategy of its own, because it faces similar A2/AD issues in its east and south.
There are currently plans for an EU-funded Defence Research Programme (EDRP) led by the
European Defence Agency in the next Multi-Annual Financial Framework from 2021-2027 (Group
of Personalities on the Preparatory Action for CSDP-Related Research, 2016).
No matter how one thinks of the many normative questions surrounding this topic, the wider
implications of any shift in the military power of the USA will be huge. In addition, most of the
technological, political, economic and social global trends referred to above are not set in stone, but
to change their course will require concerted will and efforts on the part of the EU.
By Leopold Schmertzing
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3. Vignettes
The Asian century: economic powerhouse or stuck in transition?
By Marcin Cesluk-Grajewski
Background Driven by technological develop- account for 53% of global GDP in

ment, urbanisation and growing 2050.
Asia is likely to eclipse Western domestic consumption, as people
Europe and the United States in a are driven out of poverty, Asia’s per The rise of Asia will be part of a
shift of economic power over the capita income could rise six-fold by wider trend that will see the evolu-
next five decades, regaining the 2050 to reach Europe’s current lev- tion of most developing countries,
dominant economic position it had els, which would make some three whose share of global GDP will
some 300 years ago. Two influential billion Asians affluent by current rise to 57% by 2030, according to a
studies, from the Organisation for standards. Western Europe and the study by consultancy KPMG. China
Economic Co-operation and Devel- United States would still top Asia in and India alone will account for
opment and from the Asian Devel- terms of per capita GDP and living 25% of global GDP by that year and
opment Bank, predicted several standards. for 35% of the world’s population.
years ago that the 21st century is A PWC paper forecasts that China’s
likely to be dominated by Asia - the Under an optimistic scenario, which share of the world’s GDP in pur-
19th century having belonged to assumes a benign internation- chasing power terms will increase
Europe and the 20th century to the al environment, including trade from 16.5% in 2014 to a peak of
United States - if that continent’s liberalisation and free movement of around 20% in 2030 before declin-
governments pursue policies of capital and technology, Asia’s share ing to around 19.5% in 2050. India’s
inclusive growth, innovation, good of global gross domestic product share of global GDP in PPP terms
governance and avoid what econo- will rise from 26% in 2000 and 32% could increase steadily from just
mists call the Middle Income Trap. in 2014 to more than 50% in 2050. under 7% in 2014 to around 13.5%
in 2050.
More recent studies from the Econ- Under the ‘Asian century scenario’,
omist, PricewaterhouseCoopers and Asia’s GDP could reach US$ 174 India could overtake the EU and the
KPMG confirm the rise of Asia. This trillion in 2050, accounting for 52% United States in terms of its share
is a trend that started in the 20th of global output, compared with of the world’s GDP in PPP terms by
century, with the rapid economic 18% for Europe and 13% for North 2044 and 2049 respectively. Given
growth of Japan, followed by South America, according to the Asian De- the rise of India and China, the
Korea, Singapore and other Asian velopment Bank. But if the ‘Middle USA’s share of world GDP in PPP
Tigers, and now continues with the Income Trap scenario’ materialises, terms will face a steady decline
expansion of China, India, Malaysia Asia’s GDP could only be US$ 65 from around 33% in 2014 to around
and others. China already overtook trillion in 2050, accounting for 31% 25% by 2050.
the United States in 2014 as the of global output, compared with
world’s largest economy relative to 28% for Europe and 21% for North
purchasing power (PPP) and is likely America. The more recent study
to do so in market exchange rate of the Economist Intelligence Unit
terms before 2030. paints an optimistic picture, fore-
casting that Asian countries would
Main Sources
• Johansson et al. (2012) Looking to 2060: Long-term global growth prospects. OECD Economic Policy Papers.
• Asian Development Bank (2011) Asia 2050: Realizing the Asian Century.
• Economicst Intelligence Unit (2015) Long-term macroeconomic forecasts. Key trends to 2050.
PE 573.301 26
Possible disruptions Key uncertainties

Asia’s rise will depend on internal policies and external
• Japan could overcome its economic stagnation, factors:
which has lasted for more than two decades,
• Ensuring inclusive economic growth. Increasing inequal-
reinforcing the economic rise of Asia.
ity may undermine social cohesion, posing a threat to
• China’s impressive economic growth could stability. China’s interior is unlikely to grow as fast as its
crumble due to political instability resulting from coast regions, making it necessary to redistribute wealth
growing inequalities or inefficiencies of the sys- to poorer areas.
tem ruled by the Communist Party. • Growing wealth often leads to demands for democrati-
• Global warming could undermine coastal popula- sation, which could pose a challenge for China’s ruling
tions, where China’s economic activity is centred party. Evidence suggest that such demands appear when
on and/or threatens its agricultural sector and GDP per capita exceeds US$ 15 000, a threshold China
those of other Asian countries. passed recently.
• Brewing conflicts between China and Japan • Avoiding the Middle Income Trap, where countries are
could escalate, destabilising the situation in the caught when they are no longer able to compete with
region. Such destabilisation could also result low wage economies in manufactured goods and are not
from a major conflict involving North Korea. yet capable of competing with advanced economies in
high-skill innovations. A good education system is key to
avoiding the trap.
• International competition for limited natural resources
and a rise of populism and xenophobia could lead to
trade and investment protectionism.
• Poor governance and weak institutional capacity would
harm growth.
Main Trends to 2030

Most Asian countries could increas- to nearly double from 1.6 billion to 3
ingly harness the full potential of billion. The increased economic influence is
technology, innovation and entrepre- likely to translate into more political
neurship, following in the footsteps of Asia will develop new financial and military power, allowing Asian
Japan, the South Korea and Singa- centres; with its share of global GDP countries to play a greater role in
pore. In this case, the countries will rising to 50% or more, it should also international institutions, such as the
become creators, not just buyers, of therefore have about the same share United Nations and the International
advanced technologies. of the world’s financial assets, banks, Monetary Fund. Having more influ-
and equity and bond markets. ence, Asian countries may take more
Asia is likely to continue to under- Economic expansion is expected to ownership for solving global prob-
go massive urbanisation, creating create a virtuous circle of growing lems, such as climate change, energy
industrial and technological clusters purchasing power of people, which conservation and resource scarcity,
characterised by high productivity. will boost domestic demand and con- according to a PricewaterhouseCoop-
By 2050, Asia could be transformed, sequently bolster production of goods ers study.
as its urban population is expected and services.
• KPMG International (2013) Future State 2030: The global megatrends shaping governments. Mowat Centre for Policy
Innovation.
• Hawksworth & Chan (2015) The World in 2050: Will the shift in global economic power continute?. Pricewaterhouse-
Coopers LLP.
27 PE 573.301
Global Trends Unit
Jobless growth: will robots and computers destroy our jobs?

By Marcin Cesluk-Grajewski
Background According to some estimates, 47 are remodelling passenger transport

per cent of total employment in and tourism. Already in the 1980s,
Renowned economist John May- the United States is in a high risk Nobel Prize-winning economist
nard Keynes predicted nearly 80 category, and potentially automata- Wassily Leontief wrote that ‘the
years ago that the world would face ble, a study by Martin Oxford School role of humans as the most impor-
‘technological unemployment’ showed. A Mckinsey predicted that tant factors of production is bound
‘due to our discovery of means technologies could automate 45 per to diminish in the same way as the
of economising the use of labour cent of the activities people are paid role of horses was first diminished
outrunning the pace at which we to perform and that about 60 per and then eliminated.’
can find new uses for labour.’ Most cent of all occupations could see 30
mainstream economists say that the per cent or more of their constitu- However, automation is likely to
current technical revolution is set to ent activities automated. eliminate relatively few jobs entire-
destroy many jobs, but that it will ly. Rather, it will take over varying
create enough new ones to prevent In the past, technological progress parts of their constituent activities,
unemployment from spiralling out shifted the composition of em- with predictable physical work, data
of control. ployment, first from agriculture to processing and data gathering being
artisan shops, then to manufactur- the most feasible to be automated.
This is what happened during pre- ing and clerical work and finally to Managerial jobs and those involving
vious industrial revolutions. But a service and management occupa- the application of complex expertise
growing number of experts believe tions. Since the 1970s, there has are the least prone to automation.
that Keynes’ prophecy may materi- been a decline in employment in Unpredictable physical work, such
alise in the 21st century, although routine-intensive occupations, con- as forestry or animal breeding, will
wise government policies may sig- sisting of tasks that follow well-de- also be difficult to automate.
nificantly alleviate the process. fined procedures. Human telephone
operators have almost disappeared, Finally, even if certain activities can
Drones delivering goods, driverless as have most reservation officers, be automated, it does not mean
cars, computers offering medical and many members of the office that they will be, as the process
diagnoses, fully automatised man- staff, many cashiers and warehouse will also be determined by the cost
ufacturing lines and call centres, workers. of labour. If cheap workers are
self-serving kiosks, algorithms easily available while machines are
replacing accountants, machines re- Investment banks are further auto- expensive, jobs are still likely to be
plying to emails, computerised legal mating their trading routines and performed by humans. The jobs
and tax assistance as well as pro- back-office operations. Law firms of bookkeepers and accountants,
grammes writing news stories are are replacing the work of parale- for example, require skills and
just some examples of digitalisation gals with data mining programmes, training, so they are scarcer than
and automation that may destroys while hospitals are increasingly simple cooks. But the activities they
more jobs than they create. using computers for diagnoses and perform cost less to automate, re-
health monitoring. Massive Open quiring mostly software and a basic
The contribution of labour to gross Online Courses are reshaping educa- computer.
domestic product would thus shrink. tion systems. Sharing economy firms
Main Sources
• Brynjolfsson & McAfee (2014) The second machine age: Work, progress, and prosperity in a time of brilliant technologies.
• Chui, Manyika & Miremadi (2016) Where machines could replace humans—and where they can’t (yet), McKinsey Quarterly.
• Frey & Osborne (2013) The Future of Employment. How Susceptible are Jobs to Computerisation. Oxford Martin School.
• European Policy and Strategy Centre (2016, June 10) The Future of Work, Skills and Resilience for a World of Change.
• Robertshaw (2015) The collabroative economy. EPRS, European Parliament.
PE 573.301 28
Key Uncertainties Possible Disruptions

• The pace of innovation itself is uncertain. Some • Technological breakthroughs could provide key
experts anticipate its exponential growth and an disruptions. If machines were to develop an under-
imminent explosion of new technologies in the ar- standing of natural language on a level similar to
eas of big data analysis, robotics, machine learning human beings, the process of automation would
and artificial intelligence. Others say progress will advance rapidly, notably in retail, finance, insurance
be limited to the fine-tuning of the currently availa- and healthcare.
ble applications. • The development of artificial intelligence would po-
• Armed conflicts, climate change, the rise of pop- tentially open the way to unlimited automation.
ulism and other factors may lead to protectionism, • A major war could sever links in the global intercon-
winding down globalisation and harming techno- nected economic system, slowing innovation and
logical change. automation.
• Politics may stop or slow innovation. Decisions • Cyber wars or, generally, an inability to maintain cy-
as to whether to adopt innovation can be resisted bersecurity, would severely limit automation of white
through non-market mechanisms and political collar jobs in areas such as tax advice, law, accountan-
activism, for example by government action to cy and investment banking.
protect certain sectors.
• Future employment will depend on whether ed-
ucation systems are overhauled to equip people
with the right set of skills, including hard ones, such
as software design and soft ones, such as social
intelligence.
Main Trends to 2030

Most routine professions are likely to ingly easy to challenge incumbents. dependent professionals or allocated
be gradually automated, except for Market polarisation will continue, to temporarily hired teams, physical
those when human contact is valued. with growing employment in high-in- or virtual. This approach to work may
Cognitive/non-routine jobs will contin- come, cognitive jobs and low income negatively impact the social security
ue to be done by people, barring the manual occupations, accompanied by system, which was designed for work-
development of artificial intelligence. a gradual reduction of middle-income ers with permanent contracts.
routine jobs.
‘Winner-takes-it-all’ markets, Social security systems and income
products and people are emerging, in Social inequalities which began to distribution may undergo reform in
which the best performers are able to grow in the 1980s, may increase order to ensure the continuation of
capture a very large share of the re- further, and ‘The Hollywood model’ the social and economic system.
wards, and the remaining competitors of work on demand will become ever
are left with very little. more popular. Jobs will be broken into
However, start-ups find it increas- projects that may be outsourced to in-
• Von Woensel & Garrido-Lestache (2015) What if your shopping were delivered by drones? EPRS, European Parliament.
• International Labour Office (2014) Global Employment Trends 2014. Risk of a jobless recovery.
• World Economic Forum (2016) The Future of Jobs.
• Sachs & Kotlikoff (2012) Smart machines and long-term misery (Working Paper No 18629). National Brueau of Economic
Research.
29 PE 573.301
Global Trends Unit
Blockchains and trust: a revolution, reformation or just

another tech-toy?
By Freya Windle-Wehrle
Background and uses cryptography to verify However, not only is it a quantum

them and keep information private. leap in land registries. IBM is exper-
OECD statistics show a constant Using decentralised consensus, imenting with digital consumables
decline in trust in national govern- a blockchain eliminates the need marketplaces in a decentralised IoT
ments since 2007. Recent scandals for trust and keeps expenses low (Internet of Things), where appli-
such as the Panama Papers play as verification processes become ances of the future autonomously
their part. However, the issue goes redundant. One of its great promis- manage their consumables via
much deeper when corruption and es is that it can serve as a decentral- blockchains. Having sufficient intelli-
fraud govern. Then, societal percep- ised, permanent, unalterable store gence, they will engage in real-time
tions change even faster in search of all types of information or assets, negotiating, for example power
of solutions to poverty, inequalities not just as a currency or payment usage to reduce costs, or requesting
and vulnerabilities in infrastructure. system. and paying for their maintenance.
Supply chains will be turned inside
Here, the blockchain technology Although blockchain-based enter- out by this trend, also regarding
that undergirds crypto-currencies prises still seem some way away, methods of payment.
could have a far-reaching impact as public ledgers relying upon this
it is a cheap, tamper-proof and data technology are already a reality. Blockchains will reduce the use of
based technology that can replace Ghana uses it to digitise land titles, intermediaries between producers
trust with transparency. It is a thereby replacing unreliable or and consumers in most processes in
breakthrough that will fundamen- non-existent public registries. Bit- financial services. This is a disrup-
tally change people’s notions of cen- land, a non-profit organisation, sup- tive factor which can dramatically
tralised authority. Hence, zero-trust ports citizens in this process which overhaul the traditional banking
computing, digital public ledgers decentralises and democratises by system and industries (e.g. insur-
and self-executing smart contracts safeguarding property rights. The ances - Everledger). Protecting land
are emerging, blockchain-based result is emancipation. Honduras titles and preventing property fraud
trends that will be increasingly and the Republic of Georgia are also is a major step forward in its own
important in the coming years — by in the forefront. In Honduras, the right. Opportunities also arise in the
2023 at the latest, according to the public sector has begun a project to education sector: the University of
World Economic Forum. reduce fraud in its land registry by Nicosia already issues academic cer-
moving data onto a tamper-proof tificates that can be verified through
But how does a blockchain operate? digital ledger. The prototype makes a blockchain. So, with a trustworthy
Put simply, it is a universal digital alteration or deletion of stored in- record that anyone can inspect and
ledger that functions by means of a formation impossible. Early in 2016, no single user controls, is there still
public peer-to-peer network in a de- Georgia’s National Agency of Public a need for trust?
centralised system such as Bitcoin. Registry started a blockchain land
Many other examples are emerging titling project together with the
(e.g. Ethereum). The ledger holds a Institute for Liberty and Democracy.
record of every transaction made,
Main Sources • Deloitte (2016) Getting smart about smart contracts. CFO Insights.
• Drucker (2016) Blockchain applications in the public sector. Deloitte.
• European Policy and Strategy Centre (2016, June 10) The Future of Work, Skills and Resilience for a World of Change.
• von Weizsäcker (R.) (2016/2007(INI) Report on virtual currencies. ECON Commitee, European Parliament.
• Chavez-Dreyfuss (2015, May 15) Honduras to build land title registry using Bitcoin technology. Reuters.
• Pureswaran et al. (2015) Empowering the Edge - Practical Insights on a Decentralized Internet of Things. IBM
PE 573.301 30
Key uncertainties Possible disruptions

• Regulation: A regulatory framework for blockchains • A blockchain is a mundane process that has the potential
is lacking. However, it is still too early to create one to revolutionise how people, governments and business-
as the full potential of the technology is unknown. es cooperate since it replaces the need for third-party
Moreover, as warned against in a recent European institutions to provide trust for financial, contract and
Parliament resolution on virtual currencies (rappor- voting activities.
teur: Jakob von Weizsäcker (S&D, Germany), could • Massive disruption is expected in the banking sector due
too much regulation stifle innovation? And, at which to non-bank players in payment systems.
level should a decentralised peer-to-peer system be
• Together with the IoT and Big Data, systems are becom-
regulated?
ing ‘smart’ and integrated. There is likely to be a signif-
• Registration authorities: The combination of many icant economic transformation which will have major
processes and systems into one increases efficiency implications for how businesses are conducted in the
and reduces costs. Will this kill jobs? future.
• Environment and energy consumption: How much • Digital revolution generates new jobs such as blockchain
power does the network, do the networks con- developers, IoT architects and cognitive computing en-
sume? What are the costs? gineers. This deconstruction of work and labour reallo-
cation in turn require an adapted approach to education
• Security and risks: What if a blockchain is compro- and retraining of workers.
mised or weaponised?
• Blockchains are potentially a serious challenge to tradi-
• Ethics: If everything is stored, what about the ‘right tional power structures and centralised authority, and
to be forgotten’? in particular to administration, as the need for regulation
remains. But they also represent an opportunity, for
example with regard to new tax mechanisms.
Main Trends to 2030

Start-ups hope to capitalise on Industry leaders and banks are cus- autonomously (‘Device Democracy’)
blockchain technology - either the tomising and tailoring the blockchain via blockchains in financial and non-fi-
Bitcoin blockchain or new ones such distributed ledger technology to fit nancial settings.
as Ethereum. Their applications run very particular uses.
on custom-built blockchains that are Decentralised, autonomous organisa-
backed by a shared global infrastruc- Blockchain algorithms will massively tions and marketplaces will emerge,
ture. They are free of fraud, censor- replace traditional jobs in areas such consisting of virtual companies
ship or third-party interference. as accountancy, banking, translation running on a blockchain-based set of
and legal assistance, creating vacan- rules.
Tracing product provenance along cies in the ICT sector (see the vignette
the value chain could lead to more on Jobless Growth).
informed consumer decision-making.
Hence, a more transparent and safer There are likely to be radical effects
market could emerge. on the IoT as devices will perform
• Brody & Pureswaran (2015) Device democracy - Saving the future of the Internet of Things. IBM.
• OECD (2015) Government at a Glance 2015.
• The Economist (2015, October 31) Blockchains. The great chain of being sure about things.
• World Economic Forum (2015) Deep Shift - Technology Tipping Points and Societal Impact.
• World Economic Forum (2015) The Future of Financial Services.
• World Economic Forum (2016) How a blockchain works.
31 PE 573.301
Global Trends Unit
Additive Manufacturing in 2030: how the next Gutenberg

revolution may bring production back to Europe
By Danièle Réchard with Arun Frey (Trainee)
Background implications of ‘democratised man- Apparent growth in the area of

ufacturing’. additive manufacturing requires
Additive Manufacturing (AM, also governmental action and policy
referred to as 3D printing) refers According to The Atlantic Council, response, from adjustments in
to the process by which three-di- ‘AM is perhaps at the point of the intellectual property rights to
mensional products are built from earliest development of personal consumer protection laws, without
the bottom up, adding material computers or at the beginnings of stifling future innovation.
layer-by-layer on the basis of a the Internet and the World Wide
digital file. Through this additive ap- Web’. According to the European Commis-
proach it is possible to manufacture sion, additive manufacturing tech-
complex shapes and intricate parts Adoption of AM is growing at a rap- nology is expected to generate US$
at near 100% material utilisation id pace, and 3D printing has found a 11 billion of revenues in 2020 in the
that could not have been made by foothold in various diverse sectors, EU alone. However, these numbers
traditional means. including in the areas of medicine, could be as high as US$ 105 billion
food, prototyping, construction if current barriers to the industry’s
Due to its flexibility, its potential to and robotics among others. growth could be removed. AM
fundamentally alter the production maximises production flexibility,
cycle and to ‘democratise manufac- Desktop-scaled 3D printers are minimises the use of resources and
turing’, some believe AM and 3D becoming more affordable, fab-labs the carbon footprint of manufactur-
printing to be the precursor of an and digital fabrication workshops ing and increases local production,
‘Industry 4.0’, a shift to a digital- are emerging throughout Europe, which in turn strengthens regional
ised, automated and data-oriented and 3D printer sales are growing economies within the EU.
manufacturing industry. rapidly, indicating that the onset
of the 3D printing revolution is
The technology’s disruptive poten- increasingly becoming a reality.
tial has caused both excitement and
worry: In the seventh European Frame-
work Programme (FP7), ‘the EC
On the positive side, the potential funded more than 60 successful
of bio-printing could fundamen- projects in AM, with a total amount
tally revolutionise medicine by, for of EU contribution of over €160
example, printing organs from pa- million and a total budget of €225
tients’ own cells, thereby alleviating million’.
current organ shortages.
Additive Manufacturing has be-
On the negative side, the issue of come a research priority in Horizon
3D printed firearms has raised se- 2020, identified as a key enabling
curity concerns about the adverse technology.
Main Sources
• Campbell et al. (2011) Could 3D printing change the world? Atlantic Council.
• European Commission (2014) Additive Manufacturing in FP7 and Horizon 2020.
• Smit, Kreutzer, Moeller & Carlberg (2016) Industry 4.0. DG IPOL, European Parliament.
• van der Zee, Rehfeld & Hamza (2015) Open Innovation in Industry, Including 3D Printing. DG IPOL, European Parliament.
PE 573.301 32

• The degree to which mass adoption of 3D print- • Large-scale restructuring of the current manufacturing
ing technologies will lead to high levels of un- process may shift manufacturing back to Europe. 3D
employment is ambiguous. The WEF recognises printing could severely shorten the supply chain (with
that advances in AM would reduce the amount of goods being printed on-demand), sparking localised
labour needed in production, but these negative and dynamic production.
effects could be partially mitigated by the birth of • Additive Manufacturing could be a way to increase pro-
a new industry supplying printing materials. ductivity in Europe despite a decreasing workforce.
• To what extent will additive manufacturing re- • On the other hand, a reduced need for labour in indus-
place traditional methods of production, which, trial production could have a destabilising effects in
as of now, still have considerably lower produc- some countries.
tion costs? • Unprecedented advancements in bio-printing have
• A positive scenario is a shift from mass produc- the potential to significantly extend life expectancy.
tion, where Europe is facing tough competition Would such technology be available for everyone, or
from developing countries, to full customisation, would it further widen the health divide between rich
to keep the European economy competitive and and poor? Could the possibility to easily replace organs
at the forefront of innovation. create disincentives to care about one’s health?
• That said, it could take years before the impact • Will 3D printing really be a relief for the environment
of 3D printing is felt beyond a limited range of or will it simply lead an explosive growth in the con-
goods. sumption of plastic goods, potentially increasing the
environmental burden?
Main Trends to 2030

By 2030 conventional buying habits Additive manufacturing will have an issue of organ shortages.
will have changed considerably, with impact on the future labour market,
individuals printing their own prod- potentially reducing the labour costs Although the ‘democratisation of
ucts directly from their home. Buying in some industrial sectors to almost manufacturing’ will bring multiple
goods in stores will change too, with zero and shifting manufacturing back benefits and spark innovation and
a move away from mass produced to to European countries. entrepreneurial opportunities, it will
fully customised items. also increase the risk of copyright
Gains in 3D printing technology will infringements, and raise security
The McKinsey Global Institute also significantly spur innovations in concerns.
estimates the economic impact of other sciences, especially related to
3D printing to lie between US$ 230 nanotechnology and bioengineering.
billion and US$ 550 billion per year by Ongoing bio-printing using human
2025. tissue could revolutionise organ trans-
plantation and potentially solve the
• Manyika et al. (2013) Disruptive technologies: Advances that will transform life, business, and the global economy. McKinsey.
• Robertshaw (2015) The Collaborative Economy. EPRS, European Parliament.
• von Woensel & Archer (2015) Ten Technologies which could change our lives. EPRS, European Parliament.
• World Economic Forum (2015) Deep Shift: Technology Tipping Points and Societal Impact.
33 PE 573.301
Global Trends Unit
Intolerance and hate crime: the return of an old problem?

By Eamonn Noonan
Background years. In Germany alone, 1 031 punitive measures; there must also
incidents targeting accommodation be ample room for rehabilitation.
Increased intolerance has long been centres for asylum seekers were The International Network for Hate
identified as a worrying trend in recorded in 2015 — a five-fold Studies stresses the importance of
foresight reports. For example, the increase on the previous year. 95 alternative ways to address hate
EUISS stated that ’Migrants and eth- of these involved arson. In the crime, including restorative justice
nic minorities will become the main UK, the latest reported figures for approaches. Considerable efforts
target of groups opposing cultural hate crimes showed a year on year are underway to help draw young
diversity, and are likely to be the increase of 18%. Attacks on people people away from extremist groups,
victims of xenophobia in many choosing to follow religious dress and this must also be pursued.
developed countries‘. The EUISS codes by wearing a headscarf or a
report framed it in the context of kippa are one aspect of this trend. There is also a problem of under-re-
developments that were otherwise Different tendencies are coming porting of hate crimes and discrim-
quite encouraging. It suggested together: The European Commis- ination, which itself can be a signal
that ’the decline of theories of sion against Racism and Intolerance of lack of trust in the authorities
conflict between civilisations and (ECRI) expresses concern that the among minority groups. Funding
cultural relativism is therefore Islamophobic trend has merged cuts for services to combat racism
likely, although economic and with growing anti-immigrant and intolerance make it harder to
social difficulties may reverse this sentiment, due to the influx of raise awareness of the problem.
positive trend in some countries, large numbers of migrants from On the other hand, advances in
and extremist identity politics and Muslim-majority countries. Other technology make it easier to track
xenophobia will continue to leave background factors linked to this violent incidents, and smartphone
a mark on some parts of the world.’ increase include terror attacks and recordings have often proved
In a similar vein, the Rand report the arrival of large numbers of crucial in bringing perpetrators to
spoke of the possibility that the refugees and economic migrants. justice. It seems likely that greater
presence of ethnic minorities would Austerity is also associated with in- awareness of the extent of hate
be widely regarded as undesirable creased intolerance. As ECRI notes, crime and of the societal costs of
and divisive. More recently, the ref- the rise of right wing extremism, intolerance would prompt firmer
ugee crisis from 2015 prompted the embracing xenophobia, anti-Semi- responses by the authorities.
World Economic Forum to note that tism and Islamophobia, is another
’insularity, xenophobia and right- contributing factor.
wing populism are gaining ground
across the continent, calling into The vigour with which authorities
question the integration process and public opinion respond to
and a common European front on intolerance and hate crime can
international security policies‘. vary. Amnesty International has
recently criticised a tendency to
A rise in intolerance, hate speech fail to adequately investigate and
and hate crimes has been docu- pursue hate crimes. Yet official
mented in parts of Europe in recent responses should not be limited to
Main Sources • Amnesty International (2016, June 9) Living in Insecurity: How Germany is failing victims of racial violence.
• BBC News (2015, October 13) Hate crimes reported to police up 18% in England and Wales.
• OSCE ODIHR. Hate Crime Reporting Website.
• Bjørgo (2011) Dreams and disillusionment. Crime, law and social change, 55(4), 277-285.
• EU Agency for Fundamental Rights (2016) Fundamental Rights Report 2016.
• European Commission against Racism and Intolerance (2015) Annual Report on ECRI’s activities covering 2015.
PE 573.301 34
• Will the growth of hard-line nationalist political • Self-segregation among minorities could result in higher
parties translate into sectarian and discriminatory levels of intolerance. Some within minority communi-
policies? If support for extremist parties declines, ties urge disengagement from the host society; some
or if radical groups moderate their rhetoric as they Muslim communities have been targeted by ideologues
gain political office, this risk will be reduced. This agitating for the replacement of democracy with theoc-
is a dangerous assumption; European history pro- racy.
vides notorious examples to the contrary. • Ghettoisation on identity lines, whether imposed by
• Will intemperate commentary through social the majority or embraced by the minority, would likely
media lead to an increase in racist attacks? There provoke increased intolerance and social conflict. This
are some indications that racist comment creates a has implications both for urban planning and for policies
climate favourable to violence. The possibility of towards segregated education.
a causal link between these phenomena, beyond • Economic recession is a potential obstacle to progress,
mere correlation, deserves attention. This has given the association of poor economic performance
implications for strategies to combat online hate and intolerance. Absence of economic recovery and
speech. labour market stagnation could well lead to systematic
disparities by subgroup on income, employment, health
• New channels for dissemination of racist content and educational achievement. This scenario would
are likely to emerge, and this will call for vigilant create favourable conditions for radicalisation among
preventive strategies. minority youth and a possible pattern of reciprocal
violence.
Main Trends to 2030

History has many examples of integra- discrimination. It helps that respect an improvement in mechanisms to
tion improving with successive gener- for human rights is a core European monitor hate crime and hate speech,
ations. This is also a possible outcome value. An energetic civil society is and in mechanisms to intervene rap-
in twenty-first century Europe. An hard at work to promote tolerance idly where problems emerge.
alternative, negative scenario, how- and cross-community relations. These
ever, is a persistence of hatred and factors are likely to move develop-
division, accompanied by increased ments towards the more favourable
levels of hate crime. Policy decisions scenario.
will influence matters: inaction could
permit a downward spiral of hostility It remains important to grasp the
and division. seriousness of the problem, and its
potential to create deep and lasting
Europe has the advantage of a strong conflicts if not tackled. Signs that
legal basis for combatting all forms of progress is being made would include
• de Vasconcelos (Ed.) (2012) Global trends 2030 – Citizens in an interconnected and polycentric world. EUISS.
• Prpic (2015) Promoting tolerance in the EU. EPRS, European Parliament.
• Hoorens et al. (2013) Europe’s Societal Challenges. RAND Europe
• World Economic Forum (2016) The Global Risks Report 2016.
• International Network for Hate Studies Website.
• Walters (2014) Hate crime and restorative justice: exploring causes, repairing harms.
35 PE 573.301
Global Trends Unit
The mobile internet and democracy: less citizen empowerment

than we thought?
By Eamonn Noonan
Background extremism. Yet a balance must be cation of politics that could shrink,
struck that preserves freedom of rather than enlarge, the public
Real-time communications via in- expression. Overregulation, or the sphere. The political landscape of
ternet and large-scale participation wholesale criminalisation of dis- Europe differs greatly from that
in social media can for the purpos- senting opinion, would be negative of the US. It is more multifaceted,
es of convenience be referred to developments. A related concern and does not have the duopoly of
as the ‘mobile internet’. This is a is that sophisticated data analysis large parties that characterises the
relatively recent phenomenon, but tools may allow manipulation of latter. This may give greater scope
it has already shown its potential public opinion. New technology for the emergence of technologi-
to impact political affairs. The Arab brings opportunities for citizen cally innovative new actors, such as
Spring, the Umbrella movement in empowerment, but it also increases The Five Star Movement (M5S) in
Hong Kong, and the emergence of the vulnerability of individuals to Italy and Podemos in Spain. Yet a
new political parties in Europe, all intrusive surveillance. trend for established large parties
owe a great deal to the emergence to lose ground in Europe has been
of new, internet-based channels for The mobile internet affects the rel- apparent for some time: the mobile
communication and networking. ative power of incumbent political internet may have encouraged this
parties. New parties have used development, but it did not cause
What impact will the mobile inter- social media effectively to over- it.
net have in the coming years? One come lack of access to mainstream
scenario is of greater participation media, especially since younger The use of the mobile internet
in debate and in elections; another voters increasingly rely on new to open up policy making and
is of knee-jerk responses crowding media rather than traditional news nomination processes has the
out more deliberative and strategic sources, including television. Yet the potential to lessen the gap between
policy-making. Some emphasise conclusion that new media make decision-makers and the people.
the prospect of individual empow- it easier for new parties to emerge Several parties are innovating in this
erment, while others worry about is an over-simplification. Groups direction, including Partido de la
a dumbing-down of the political that integrate new media into their Red, Argentina, D66 and the Labour
process. A more fundamental election strategy campaigns seem Party in the Netherlands and the
question is whether the balance of to gain at the expense of those Liberal Alliance in Denmark, as well
power will ultimately shift towards, which stick to traditional, top-down as M5S and Podemos referred to
rather than away from, incumbents, approaches. But established parties above.
who tend to have greater capacity that engage seriously with new me-
to store and analyse user data. dia can prosper; an example is the
targeted ground game of the Oba-
There is consensus on the need ma campaigns in 2008 and 2012.
to combat hate speech in social Indeed, the large scale commercial
media, to say nothing of the use harvesting of data on individual
of the internet to promote violent preferences favours a commodifi-
Main Sources
• Carr (2011) The shallows: What the Internet is doing to our brains.
• Lévy-Bencheton & Darra (2015) Cyber Security and Resilience of Intelligent Public Transport. ENISA.
• Fox & Ramos (Eds.) (2011) iPolitics: Citizens, elections, and governing in the new media era.
• Hofmann (2016) Digitisation and Democracy: The challenges of shaping the Digital Society.
• Margetts et al (2016) Political Turbulence: How Social Media Shape Collective Action.
PE 573.301 36

• Greater citizen engagement means greater insist- • Cybersecurity is a core issue. Large-scale theft of
ence on transparency and accountability, and this personal data is occasionally reported, but this has
makes it more difficult to keep bad behaviour and not slowed the progress of online services. Credible
sharp practice out of the public eye. evidence of manipulation of electronic voting machines
after a closely fought election could change this. So
• Some argue that ‘Brexit represents the first major
could a major incident involving loss of life, for example
casualty of the ascent of digital democracy over
related to hacking of transportation systems.
representative democracy,’ and that digital democ-
racy has contributed to polarisation, misinforma- • Successful management of security threats is essential
tion and stasis. for continued public trust in the internet.
• The fragmentation of the internet from a unified global
• Social media has the capacity to magnify individ-
system to a number of rival systems is another risk
ual incidents and create pressure for immediate
factor. Whether this occurred as an incidental result
responses to complex challenges.
of technological innovations or because of deliberate
• The public interest it not always served if short- policy decisions, it would have major implications, not
term fixes are preferred to long-term planning, in only for economic development, but also for relations
areas where carefully designed policy packages, across the Atlantic.
with a payoff over years rather than weeks, are the • Mismanagement of the issue of privacy versus surveil-
key to progress. lance would compromise the potential of the mobile
internet to promote democratic participation and
empowerment.
Main Trends to 2030

The mobile internet may well en- ruled, which have declined in particu- A return of economic prosperity
hance the present trend in Europe lar since the 2008 financial crash. would likely encourage positive
in favour of ’issue-based‘ political scenarios of constructive citizen
initiatives, and thus create further Trust might increase if governments engagement; continued economic
challenges for long established ’big- chose to play a more modest role stagnation would make for greater
tent‘ parties. The political landscape in certain areas, in order to allow polarisation and fragmentation.
would see more fragmentation. the engaged citizen greater room to
generate solutions.
New media afford new opportunities
to promote and coordinate grass If one accepts the view that the
roots input, and to challenge top- internet is an intensifier rather than a
down, centrally controlled processes. determinant of trends, the key driver
The mobile internet could influence will be the extent to which current
levels of trust between rulers and the economic challenges are overcome.
• Jaishankar (2016, June 29) Brexit: the first major casualty of digital democracy. Brookings.
• Loader & Mercea (Eds.) (2012) Social media and democracy: Innovations in participatory politics.
• Roemmele (2012) Electronic political campaigning. In Kersting (Ed.) Electronic democracy.
• Soto (2015) The weakening of representative democracy. In World Economic Forum. Outlook on the Global Agenda 2015.
• Issenberg (2012) The victory lab: The secret science of winning campaigns.
37 PE 573.301
Global Trends Unit
Russia and China in 2030: authoritarian alliance or

geopolitical rivals?
Background to divert US attention (e.g. from the is regime survival, but in contrast
South China Sea back to Europe) to China, it has not yet started to
The 2008-2009 financial crisis and to complement China in areas diversify its economy, in this case
accelerated the planned phas- where it is less competent, i.e. away from energy, to sustain long-
ing-out of China’s export-oriented modern weaponry and projecting term growth. Its apparent aim is
high-growth period. Since then, international influence (e.g. Europe, to stay economically and politically
the Chinese government has had MENA region). In the economic stable in the short-run, in the hope
two overarching goals: delicately sphere, Russia can serve as a key for a medium term rise in energy
reforming the economy while at supplier of energy and as a market prices.
the same time preserving political, for Chinese companies. Russian gas
social and economic stability. decreases pollution through coal For Russia, China is the centre piece
and is secure in its supply and is of its ’pivot to Asia’ and a lifeline
One way for the Chinese govern- therefore of key importance to Chi- that will keep Putin’s system going.
ment to achieve stability is to focus na. Regarding the multipolar global In 2009, China provided Russia’s oil
on the international sphere. It has order, Russia is already cooperating companies with US$ 25 billion to
stirred up national sentiments with China in most non-western survive the financial crisis. Simulta-
about old but popular foreign policy institutions, for example BRICS and neously, it opened its financial hubs,
grievances, especially its difficult re- SCO. like Hong Kong, to Russian firms. In
lations with Japan and Taiwan, and 2015, the two countries negotiated
the question of who rules the East Russia, after losing its role as the a 30-year energy contract worth
and South China Seas. In addition, it co-decider of world affairs in the US$ 400 billion that seems to be
has stepped up its efforts to achieve 1990s, slowly regained what it saw profitable for both sides. There are
global economic expansion, with as necessary control over its sphere questions regarding the economic
the One Belt, One Road initiative. of influence, financed mainly by viability of some of these projects.
Thirdly, it has started to build a sys- high oil and gas revenues. For a dec- But Russia highlights progress as
tem of organisations (e.g. the Asian ade now, Russia has acted militarily signalling to the West that sanction-
Infrastructure Investment Bank) or to counter what it sees as western ing its economy, and encroaching
strengthen existing ones (BRICS, interference, which includes demo- on its sphere of influence, could
Shanghai Cooperation Organization cratic reforms in its neighbourhood. come at the cost of assisting China’s
- SCO) that work in parallel to the The current western sanctions have rise. Finally, Russia hopes to find in
established western institutional hurt the Russian economy, which is China a partner to work with on the
architecture, in order to advance already under pressure due to the international stage, stabilising Cen-
global multipolarity. low oil price, the long-term effects tral Asia, securing friendly regimes
of the financial crisis, an uncompet- and building an anti-western sphere
This is where – from the Chinese itive economy, chronic mismanage- of stability.
point of view – Russia comes in. For ment and corruption.
China, Russia could be a junior part-
ner in international politics: helping As for China, Russia’s top priority
Main Sources
• Gabuev (2015) A “Soft Alliance”? Russia-China Relations after the Ukraine Crisis. ECFR.
• Strafor (2016) China leading the way to a new world order?
• Haukkala & Popescu (Eds.) (2016) Russian futures: Horizon 2025. EUISS.
• Brooks & Wohlforth (2016) The Once and Future Superpower: Why China Won’t Overtake the United States, Foreign Aff., 95, 91.
PE 573.301 38
Key uncertainties Possible Disruptions

• The extent to which Russia’s and China’s recent A ‘soft alliance’ could fail due to opposing interests:
assertive behaviour reflects strength or weakness • Russia’s repeated use of its minorities as a foreign
is unclear. This makes estimating future behaviour policy tool, contrary to the Chinese notion of non-in-
highly uncertain. terference and state-sovereignty;
• Russia and China share a long history of coopera- • leadership shuffles and political interference by Chi-
tion and rivalry. It was weakness that made Russia na or Russia in Central Asian countries;
accept Chinese influence in areas of common inter- • a nationalistic eruption of hostilities in Russia due
est and that started a rapprochement. Any change to increasing Chinese influence in its sphere of
in international, regional (e.g. Japan, Iran, India) influence or its thinly populated Far East (especially
and the respective national arenas, could upset through cheap and efficient Chinese workers and
this relationship again. companies);
• Russia’s aggressive foreign policy endeavours • Chinese-caused instability in the East China Sea or
might endanger the future partnership with Russian arms sales to Vietnam or other rivals of
China. Neither the willingness of China to support China in the South China Sea;
Russia in this, nor the level of Chinese leverage • differences of opinion on the future path of the col-
over Russian foreign policy, is clear. lectively founded Shanghai Cooperation Organization
(SCO) as an economic or security organisation,
• China and Russia may attach greater importance to
their relations with the US and the EU respectively • competition between the Eurasian Economic Union
than a possible alliance between the two countries. and the One Road One Belt initiative for influence in
Eurasia;
• personal animosities.
Main Trends to 2030

The relationship between China and Russia will be economically depend- knowledge and service economy,
Russia is likely to become stronger ent both on China and the EU. Its while most analysts are unsure about
and Moscow’s dependency on Beijing manoeuvrability will be limited due to Russia’s prospects, due to the failure
will grow: Russia will be the junior the terms of the energy contracts and of the current Russian regime to mod-
partner. If Russia can cope with the the resources it has invested. ernise and diversify the economy.
limitations of this position, it could
benefit from such a role. There will probably be closer defence
cooperation between China and
A stronger long-term future partner- Russia, with large-scale joint military
ship would mean that every problem coordination and increased Russian
any actor has with Russia or China arms exports to China.
would cause repercussions with re-
gard to the other. Global and regional In the long run, China will like-
players will be forced to adapt to this. ly succeed in transforming into a
• Kaplan (2016) Eurasia’s Coming Anarchy: The Risks of Chinese and Russian Weakness. Foreign Aff., 95, 33.
• Guriev (2016) Russia’s Constrained Economy: How the Kremlin Can Spur Growth. Foreign Aff., 95, 18.
• Grieger (2016) One Belt, One Road (OBOR): China’s regional integration initiative. EPRS, European Parliament.
39 PE 573.301
Global Trends Unit
Democracy in the Middle East and North Africa in 2030

Background cy (or governance), the NGO Free- (Syria, Yemen, Libya).

dom House concludes that, in 2016, This recent history of the area is
The Middle East and North Africa, or ratings for the MENA region are entangled with long-term global and
MENA region is a contested regional among the worst in the world. Only regional trends:
concept. Sometimes also called the two countries in the MENA region
West Asia, North Africa (WANA) are considered to be full democra- • Globally, there have been ten
region, it has no commonly accept- cies: Tunisia, with 79 points out of consecutive years of ‘decline
ed boundaries, but a long common 100, and Israel (80 points). While of global freedom’ according to
political and cultural history, mainly Israel is a long-standing democracy, the Freedom House ’Freedom
based on the Arab and Muslim iden- Tunisia has only recently taken key in the world 2016’ report. Over
tity of most of its citizens. Around steps toward democratic rule since the past 10 years, 105 countries
a fifth of Muslims worldwide live in its Jasmine Revolution (as part of have seen a net decline, and
this region, but it also encompass- the Arab Spring). It adopted a new only 61 have experienced a net
es non-majority Muslim Israel, as constitution and held national elec- improvement.
well as many religious, ethnic and tions in 2014 and has so far avoided • In addition, according to the
linguistic minorities. The definition chaos and a return to authoritari- EUISS, the Arab Muslim world
used here includes countries on the anism. is going through a political
North African coast and the Middle identity crisis: Three currents
East, from Morocco to Iraq. The three partly free states in of political Islam - electoral
the region, according to Freedom Islamism (e.g. Muslim Brother-
The two most important events House, are Lebanon (43 points), hood), authoritarian Islamism
affecting the evolution of democ- Morocco (41 points) and Kuwait (36 (e.g. Saudi Arabia), and revolu-
racy in the region in the last two points). Lebanon has been plagued tionary Islamism (e.g. ISIS) - are
decades were the US Global War on by insecurity for the last 40 years, dominating an often violent
Terror, especially the Iraq War, and but important aspects of democracy conflict, while other forms of
the so-called Arab Spring in 2011. have nevertheless survived since political participation and ideol-
Both led to major transformations in the end of the civil war in 1990. ogy seem to be on the wane.
the region, which is now in turmoil: Arab Spring protests in Kuwait and • The term ‘democracy’ evokes
violent repression of legitimate Morocco (as well as Jordan and many contradictory reactions
protest and regional antagonisms Oman) throughout 2011 were met in the region. It is associated
have led to civil wars with over 15 by both reform and limited repres- with perceived western hypoc-
million refugees; the securitisa- sion from the respective monarchs. risy, especially in relation to the
tion of domestic politics, whereby Israeli-Palestinian conflict and
‘normal’ policy issues are treated as The rest falls under the threshold the failure of the so-called Arab
security threats, has put a stop to of not free, (from high to low score: Spring, as well as controversial
reform movements; and the low oil Jordan, Algeria, West Bank, Egypt, historical concepts, such as
price and economic stagnation have Iraq, Qatar, Oman, United Arab colonialism, westernisation and
further destabilised the region. Emirates, Bahrain, Gaza, Saudi Ara- nationalism. This makes any
bia). Of these, three are currently discussion of democracy prone
Although it is hard to rate democra- theatres of civil and regional war to misunderstandings.
Main Sources • Gaub & Laban (Eds.) (2015) Arab Futures, three scenarios for 2025. EUISS.
• Freedom House (2016) Freedom in the World 2016.
• World Economic Forum (2015) Global Gender Gap Report 2015.
• Stevens, Lahn & Kooroshy (2015) The Resource Curse Revisited. Chatham House.
• Pew Research Center (2011, January 27) Table: Muslim Population by Country.
• Apap (2016) Libya after Gaddafi: A challenging transition. EPRS, European Parliament.
PE 573.301 40
Key uncertainties Possible Disruptions

• The most important uncertainty is whether long- • A new form of Islamic or Arab-nationalist interpreta-
term policies to combat rising youth unemploy- tion (or theory of) democracy could divert the strong
ment (2014 MENA average: 28%) will work or forces acting inside jihadism away from fighting and
not. Continuously high unemployment, especially could reawaken the progressive political will of the so-
among university graduates, might foster radicali- called MENA ‘youth bulge’. A new charismatic leader
sation, terrorism and criminality, but also renewed or a new school of thought could provide the source
legitimate political resistance and emigration. for such an ideology.
• The success or failure of democratic Tunisia will • Instability in Saudi Arabia due to internal power strug-
influence neighbouring countries such as Egypt gles and the low oil price could lead to a revolution or
and Algeria. The stable transformation of Ennahda a civil war, redrawing the political map of the Arabian
into a democratic conservative party might change Peninsula. Equally devastating would be an open war
electoral Islamism and make it a dominant force in between Saudi Arabia and Iran.
the whole region.
• Other possible events with potentially widespread
• Similarly, the democratic development in Egypt, effect might include large-scale attacks on tourists in
Turkey and Iran will be of the utmost importance. Tunisia or Egypt, a significant increase in food prices,
Authoritarian or democratic change will influence the failure of the Iran nuclear deal, the mutation of ISIS
the whole MENA region, but especially Tunisia, and al-Qaeda into new organisations with mainstream
Libya, Lebanon and Iraq. appeal, the collapse of the Assad regime and the re-
form of the Arab League.
• Other important uncertainties will be the future
trajectories, in terms of engagement and power, of
the US, the EU and China.
Main Trends to 2030

The population in the MENA region discrepancies in education between couraging and weakening democratic
will grow from 357 million in 2015 different MENA countries, and be- forces.
to 468 million in 2025; Egypt grows tween men and women, which will
by nearly a million people every six not change before 2030. From very The MENA region will also suffer
months. A large part of the population low levels, internet penetration will from persistent gender inequality,
in 2030 will be young people between double, from 25% to around 50% in although there is a rise in women’s
15 and 30 years of age. Over 60% of 2025. Most of these future users are political participation, especially in
the population will live in cities and young and educated, providing possi- parliaments, and improvements in
will be confronted by the effects of bilities for a vibrant social and political their economic participation.
climate change. sphere online.
This fast growing young population Even if oil prices stay low, Asian ener-
will be more literate and more con- gy demand will sustain Arab regimes,
nected. Although 90% of the young their wealth distribution and their
can read and write, there are huge rentier economies until 2030, dis-
• Immenkamp (2016) Jordan: A protest movement eclipsed. EPRS, European Paliament.

• Fukuyama (2013) What is governance? Governance, 26(3), 347-368.
• Valeri (2015) Simmering Unrest and Succession Challenges in Oman. Carnegie.
• Katzman (2016) Kuwait: Governance, Security, and U.S. Policy. Congressional Research Service.
• Prpic (2016) Democracy ranking. EPRS, European Parliament.
41 PE 573.301
Global Trends Unit
PE 573.301 42
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Global

Essays on medium- and long-term global trends

ABOUT THE PUBLISHER

To contact the Global Trends Unit please write to: EPRS-GlobalTrends@europarl.europa.eu.

Manuscript completed in October 2016.

4. Essay Bibliographies ...................................................................................................................... 43

Ignoranti quem portum petat nullus suus ventus est.

1 Seneca, L. A. Ad Lucilium Epistulae Morales. LXXI, 3

Danièle Réchard, Head of Unit

What drives water scarcity?

What are the effects of water scarcity?

What does this mean for the EU?

The importance of water management policies

World Economic Forum (2016) Global Risk Report 2016

National Intelligence Council (2012) Global Trends to 2030: Alternative Worlds

By Danièle Réchard with Arun Frey

II. Increasing inequality: from a social and political challenge to an

Economic challenges linked to growing inequality

Impact of technological change

Social challenges linked to growing inequality

Political challenges linked to growing inequality

III. Foundations of US military power in 2030: leading from the front or

Past US military dominance

The present - a mixed picture

US response to challengers and changing trends

Europe and the decline in US military power in 2030 - So what?

Background Driven by technological develop- account for 53% of global GDP in

Possible disruptions Key uncertainties

Main Trends to 2030

Jobless growth: will robots and computers destroy our jobs?

Background According to some estimates, 47 are remodelling passenger transport

Key Uncertainties Possible Disruptions

Main Trends to 2030

Blockchains and trust: a revolution, reformation or just

Background and uses cryptography to verify However, not only is it a quantum

Key uncertainties Possible disruptions

Main Trends to 2030

Additive Manufacturing in 2030: how the next Gutenberg

Background implications of ‘democratised man- Apparent growth in the area of

Key uncertainties Possible disruptions

Main Trends to 2030

Intolerance and hate crime: the return of an old problem?

Key uncertainties Possible disruptions

Main Trends to 2030

The mobile internet and democracy: less citizen empowerment

Key uncertainties Possible disruptions

Main Trends to 2030

Russia and China in 2030: authoritarian alliance or

Key uncertainties Possible Disruptions

Main Trends to 2030

Democracy in the Middle East and North Africa in 2030

Background cy (or governance), the NGO Free- (Syria, Yemen, Libya).

Key uncertainties Possible Disruptions

Main Trends to 2030

• Immenkamp (2016) Jordan: A protest movement eclipsed. EPRS, European Paliament.

Water Scarcity: an avoidable crisis?

Förster, J. (2014). Water use in industry. Eurostat. Retrieved from: http://ec.europa.eu/eurostat/statistics-

OECD. (2012). Environmental Outlook to 2050. Paris: OECD Publishing.

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