Key Insights for 2021 and Beyond

The World in 2021 The World in 2021 Economist World in 2021 Summary-Shiv-Dec 31 2020

10 things to watch for in 2021 10 things to watch for in 2021 1. Fights over vaccines 2. A mixed economic recovery 3. Patching up the new world disorder 4. More US China Tensions 5. Companies on the front line 6. After the tech celeration 7. A less footloose world 8. An opportunity on climate change 9. The year of d j vu 10. A wake up call for other risks World in 2021 Summary-Shiv-Dec 31 2020

The defeat of Trump marked the end of one of The defeat of Trump marked the end of one of the most divisive and damaging presidencies in the most divisive and damaging presidencies in American history. American history. World in 2021 Summary-Shiv-Dec 31 2020

The pandemic has compressed years worth of The pandemic has compressed years worth of transformation into months, bringing a transformation into months, bringing a dramatic shake up in how people live, what dramatic shake up in how people live, what they buy and where they work. they buy and where they work. World in 2021 Summary-Shiv-Dec 31 2020

US now has tariffs on 66 % of China imports, US now has tariffs on 66 % of China imports, that will not go away. that will not go away. World in 2021 Summary-Shiv-Dec 31 2020

The risk for the Biden presidency is to be long The risk for the Biden presidency is to be long on soothing words and short on effective on soothing words and short on effective action. Biden is focused on repairing action. Biden is focused on repairing yesterdays world and not building tomorrow s yesterdays world and not building tomorrow s world. world. World in 2021 Summary-Shiv-Dec 31 2020

Enough vaccines will be available in 2021 to Enough vaccines will be available in 2021 to slow down the pandemic. slow down the pandemic. Polls have found that 25 % of adults globally Polls have found that 25 % of adults globally would refuse a vaccine. If the vaccines are 90 would refuse a vaccine. If the vaccines are 90 % or more effective, then governments will % or more effective, then governments will persuade citizens to take the vaccine. persuade citizens to take the vaccine. World in 2021 Summary-Shiv-Dec 31 2020

October 2020 IMF GDP forecast October 2020 IMF GDP forecast 2019 index = 100 2022 China 100 117 World 100 111 USA 100 102 EU 100 101 World in 2021 Summary-Shiv-Dec 31 2020

Populist leaders in USA, Brazil, India, Russia Populist leaders in USA, Brazil, India, Russia have handled the pandemic ineptly. They claim have handled the pandemic ineptly. They claim to know the will of the people and vow to to know the will of the people and vow to defend them against the elite , however the defend them against the elite , however the elite includes doctors and scientists who are elite includes doctors and scientists who are needed to fight the pandemic. needed to fight the pandemic. World in 2021 Summary-Shiv-Dec 31 2020

The pandemic makes voters susceptible to The pandemic makes voters susceptible to populism. People are scared and populist populism. People are scared and populist leaders are adept at exploiting fear. leaders are adept at exploiting fear. People are confused, so populists offer People are confused, so populists offer narratives that are easy to grasp, such as China narratives that are easy to grasp, such as China or globalization being the reasons for what s or globalization being the reasons for what s happening. happening. World in 2021 Summary-Shiv-Dec 31 2020

Who will run the worlds institutions such as the UN Who will run the world s institutions such as the UN in 2021? The world s institutions have been in 2021? The world s institutions have been weakened by the great power rivalry. weakened by the great power rivalry. China is the rising super power, increasingly China is the rising super power, increasingly assertive but not keen to take leadership of these assertive but not keen to take leadership of these institutions. institutions. Will USA under Biden be prepared to step back into Will USA under Biden be prepared to step back into that role? that role? World in 2021 Summary-Shiv-Dec 31 2020

Recessions are capitalisms sorting Recessions are capitalism s sorting mechanisms. mechanisms. America has been in recession for 14 % of the America has been in recession for 14 % of the time since World War 2 time since World War 2 World in 2021 Summary-Shiv-Dec 31 2020

In the first half of 2020, 40 % of Americas top In the first half of 2020, 40 % of America s top 3000 listed companies made losses compared 3000 listed companies made losses compared to 33 % in 2009. to 33 % in 2009. The winners from the pandemic will be big The winners from the pandemic will be big firms that benefit from technology. Yet they firms that benefit from technology. Yet they face a tricky situation as the rules between face a tricky situation as the rules between business and society will be recast. business and society will be recast. World in 2021 Summary-Shiv-Dec 31 2020

Firms will be under pressure to pay less Firms will be under pressure to pay less attention to shareholders and more to attention to shareholders and more to workers. workers. The stagnation of globalization means that The stagnation of globalization means that multinationals will have to work as federation multinationals will have to work as federation of national businesses, taking away some of national businesses, taking away some global scale advantages. global scale advantages. As size of government expands, that means As size of government expands, that means more taxes and more regulations. more taxes and more regulations. World in 2021 Summary-Shiv-Dec 31 2020

For the top 3000 firms in the world, the For the top 3000 firms in the world, the effective tax rate has dropped from 33 % to 22 effective tax rate has dropped from 33 % to 22 % in the last decade, so, now the only way is % in the last decade, so, now the only way is up. At the end of this pandemic and recession, up. At the end of this pandemic and recession, the world of business will be shaken up, and so the world of business will be shaken up, and so will the rules of capitalism. will the rules of capitalism. World in 2021 Summary-Shiv-Dec 31 2020

Customers who have tried new shopping Customers who have tried new shopping behavior in the pandemic behavior in the pandemic Country % saying they tried new shopping behavior % saying they will adopt new shopping behavior India 90 % 69 to 78 % China 85 % 72 to 81 % USA 70 % 75 to 83 % Italy 65 % 72 to 83 % Britain 62 % 81 to 88 % France 55 % 67 to 78 % Germany 50 % 65 to 82 % Japan 32 % 83 to 92 % World in 2021 Summary-Shiv-Dec 31 2020

Extreme E , a new racing series based on Extreme E , a new racing series based on electric SUVs which aims to raise awareness of electric SUVs which aims to raise awareness of climate change will stage its inaugural race in climate change will stage its inaugural race in Senegal in January 2021!! Senegal in January 2021!! World in 2021 Summary-Shiv-Dec 31 2020

In June 2021, Amazon will start using Rivian In June 2021, Amazon will start using Rivian electric vans, they hope to have 10,000 on the electric vans, they hope to have 10,000 on the road by 2030. road by 2030. World in 2021 Summary-Shiv-Dec 31 2020

In July 2021, France will give 2 weeks paternity In July 2021, France will give 2 weeks paternity leave and one week has to be used leave and one week has to be used compulsorily. compulsorily. World in 2021 Summary-Shiv-Dec 31 2020

In December 2021, India will send a manned In December 2021, India will send a manned spaceflight. When successful, this will make spaceflight. When successful, this will make India the fourth country after USA, Russia and India the fourth country after USA, Russia and China to launch people into space. China to launch people into space. World in 2021 Summary-Shiv-Dec 31 2020

Which countrys Passport is most Popular Which country s Passport is most Popular Rank 2010 2014 2018 2020 1 Britain Britain/US/Germany Japan/Singapore Japan 2 Germany Singapore 3 S Korea/Germany 4 Japan/S Korea S Korea 5 Germany Ireland Britain 6 Japan Singapore US/Ireland 7 US/Ireland Ireland 8 Britain/US 9 10 Singapore World in 2021 Summary-Shiv-Dec 31 2020

Across the world, public trust, confidence and Across the world, public trust, confidence and willingness to change behavior all stem from willingness to change behavior all stem from good leadership. In a times of crisis, people good leadership. In a times of crisis, people look to their leaders for reassurance and look to their leaders for reassurance and direction. direction. World in 2021 Summary-Shiv-Dec 31 2020

Research from previous crises shows that Research from previous crises shows that people are willing to make sacrifices if their people are willing to make sacrifices if their leaders are authentic and are accountable. leaders are authentic and are accountable. World in 2021 Summary-Shiv-Dec 31 2020

Licenses for Horse drawn carriages in Chicago Licenses for Horse drawn carriages in Chicago will not be renewed in 2021. This marks a long will not be renewed in 2021. This marks a long sought victory for animal rights activists. sought victory for animal rights activists. World in 2021 Summary-Shiv-Dec 31 2020

More guns were sold in USA in 2020 than in More guns were sold in USA in 2020 than in any previous year. America has more guns than any previous year. America has more guns than people right now (USA population is ~330 people right now (USA population is ~330 million) million) World in 2021 Summary-Shiv-Dec 31 2020

Full time employment doesnt guarantee economic Full time employment doesn t guarantee economic security anymore. We need a social safety net that security anymore. We need a social safety net that goes beyond conditional benefits tied to goes beyond conditional benefits tied to employment. employment. I tried an experiment where I gave 125 families $ I tried an experiment where I gave 125 families $ 500 a month for 24 months. They spent 40 % on 500 a month for 24 months. They spent 40 % on food, 25 % on sales and merchandise,11 % on food, 25 % on sales and merchandise,11 % on utilities and less than 2 % on tobacco and alcohol. utilities and less than 2 % on tobacco and alcohol. The day of the Universal basic income is here. The day of the Universal basic income is here. Michael Tubbs, mayor of Stockton , California Michael Tubbs, mayor of Stockton , California World in 2021 Summary-Shiv-Dec 31 2020

Poverty and economic insecurity are choices of Poverty and economic insecurity are choices of policy, not of individuals. policy, not of individuals. World in 2021 Summary-Shiv-Dec 31 2020

Australia will run out of its famous luck in Australia will run out of its famous luck in 2021. It s GDP grew for 28 years continuously, 2021. It s GDP grew for 28 years continuously, in 2021 Australians face a punishing year. in 2021 Australians face a punishing year. China buys 40 % of all of Australia s exports, China buys 40 % of all of Australia s exports, china is also the biggest supplier of tourists to china is also the biggest supplier of tourists to Australia, 1.4 million and Chinese account for Australia, 1.4 million and Chinese account for 13 % of foreign fee paying students. 13 % of foreign fee paying students. In effect Australia depends on China. In effect Australia depends on China. World in 2021 Summary-Shiv-Dec 31 2020

Indias GDP growth has been declining since India s GDP growth has been declining since 2016 and Investment since 2018.Mr Modi s 2016 and Investment since 2018.Mr Modi s foreign investment pitch has seen public foreign investment pitch has seen public enthusiasm and private reluctance. enthusiasm and private reluctance. World in 2021 Summary-Shiv-Dec 31 2020

Nominal GDP in $ Trillion Nominal GDP in $ Trillion Source : EIU 2018 2020 2024 USA 21.5 21 24.2 EU17 16 14.5 19 China 13.8 14.2 19 World in 2021 Summary-Shiv-Dec 31 2020

For years, Hong Kongers have been protesting For years, Hong Kongers have been protesting the threat from mainland China. We will never the threat from mainland China. We will never give up the struggle for our freedoms. If, as give up the struggle for our freedoms. If, as expected, in the coming year China continues expected, in the coming year China continues to grip HK in its iron fist, we will have to come to grip HK in its iron fist, we will have to come up with new ways to resist up with new ways to resist Nathan Law, pro democracy activist from Hong Nathan Law, pro democracy activist from Hong Kong Kong World in 2021 Summary-Shiv-Dec 31 2020

Oil per barrel went to $ 21 in 2020, is expected Oil per barrel went to $ 21 in 2020, is expected to be about $ 45 in 2021. Most oil states in the to be about $ 45 in 2021. Most oil states in the Middle East will find it difficult to balance their Middle East will find it difficult to balance their budget at this level of oil price. budget at this level of oil price. World in 2021 Summary-Shiv-Dec 31 2020

Oil Price required/barrel to balance budget 2021 forecast Oil Price required/barrel to balance budget 2021 forecast Iran $320 Algeria $ 120 Bahrain $ 82 Libya $ 75 Saudi Arabia $ 62 Kuwait $ 60 Iraq $ 52 Qatar $ 30 World in 2021 Summary-Shiv-Dec 31 2020

America views China as an economic America views China as an economic competitor in the Middle East. It has told the competitor in the Middle East. It has told the Middle east countries to stay off China. But, Middle east countries to stay off China. But, Arab leaders see China as a more dependable Arab leaders see China as a more dependable ally than USA and an ally who doesn t ask ally than USA and an ally who doesn t ask uncomfortable questions about human rights uncomfortable questions about human rights issues. issues. World in 2021 Summary-Shiv-Dec 31 2020

Even before Covid, Chinas engagement with Even before Covid, China s engagement with Africa is deep. There are perhaps 10,000 Africa is deep. There are perhaps 10,000 Chinese firms operating in Africa, mostly small Chinese firms operating in Africa, mostly small businesses. businesses. More African students study in China, more More African students study in China, more than the number of African students in USA than the number of African students in USA and Britain combined. and Britain combined. World in 2021 Summary-Shiv-Dec 31 2020

Dambisa Moyo argued in her book Dead Aid Dambisa Moyo argued in her book Dead Aid in 2009 that aid increases poverty by fueling in 2009 that aid increases poverty by fueling corruption and making exports more corruption and making exports more expensive. Aid is not benign, its malignant . expensive. Aid is not benign, its malignant . Africa got $ 169 Billion in aid in 2019. Aid from Africa got $ 169 Billion in aid in 2019. Aid from rich countries was $ 30 billion in 2019 rich countries was $ 30 billion in 2019 World in 2021 Summary-Shiv-Dec 31 2020

Remittances will become more important than Remittances will become more important than aid. Remittances have fallen by 25 % to $ 37 aid. Remittances have fallen by 25 % to $ 37 billion in 2020. Remittances are usually used billion in 2020. Remittances are usually used for education and housing in native countries. for education and housing in native countries. Remittances cannot be stolen by corrupt Remittances cannot be stolen by corrupt government officials. government officials. World in 2021 Summary-Shiv-Dec 31 2020

There are more than 5 million international There are more than 5 million international students. Some universities will disappear students. Some universities will disappear after the pandemic. Edmit, a college planning after the pandemic. Edmit, a college planning outfit estimates that a third of American outfit estimates that a third of American private colleges are on course to run out of private colleges are on course to run out of money within six years. money within six years. Institutions wishing to avoid this fate must find Institutions wishing to avoid this fate must find new ways of making money. new ways of making money. World in 2021 Summary-Shiv-Dec 31 2020

International students enrolled International students enrolled 2002 = 100 Index 2019 Canada 100 400 Australia 100 340 Britain 100 210 USA 100 190 World in 2021 Summary-Shiv-Dec 31 2020

In 2020, poverty will rise to levels unseen in a In 2020, poverty will rise to levels unseen in a decade. From 1990 to 2019, the number of decade. From 1990 to 2019, the number of people living under $1.90 dropped from 36 % people living under $1.90 dropped from 36 % of world population to 8 %. The UN says that in of world population to 8 %. The UN says that in 2021, nearly 240 2021, nearly 240 490 million people will be 490 million people will be pushed to multidimensional poverty. pushed to multidimensional poverty. World in 2021 Summary-Shiv-Dec 31 2020

Antonio Guterres of the UN says that we Antonio Guterres of the UN says that we don t need new bureaucracies, we need a don t need new bureaucracies, we need a networked multilateralism that links global networked multilateralism that links global institutions with regional institutions. We need institutions with regional institutions. We need an inclusive multilateralism that engages an inclusive multilateralism that engages businesses, cities , universities and businesses, cities , universities and movements for gender equality, climate movements for gender equality, climate change and racial justice. change and racial justice. World in 2021 Summary-Shiv-Dec 31 2020

Our decade of experience with a distributed Our decade of experience with a distributed workforce tells us that offices are not going workforce tells us that offices are not going away, but the way we will use them will away, but the way we will use them will change. change. Companies will not need so much commercial Companies will not need so much commercial space. People will go to the office if they want space. People will go to the office if they want or need to engage with others, not because or need to engage with others, not because the company policy requires it. the company policy requires it. World in 2021 Summary-Shiv-Dec 31 2020

This will change how work gets done and how This will change how work gets done and how companies foster culture. When workers are companies foster culture. When workers are more distributed, work gets distributed, so it more distributed, work gets distributed, so it must be documented, visible and doable in an must be documented, visible and doable in an asynchronous manner. asynchronous manner. Collaboration and camaraderie will be built Collaboration and camaraderie will be built virtually using technology that is not new but virtually using technology that is not new but has renewed purpose. has renewed purpose. World in 2021 Summary-Shiv-Dec 31 2020

A recent study found that the skills and traits A recent study found that the skills and traits of successful leaders in an in person, office of successful leaders in an in person, office based environment differ from those needed based environment differ from those needed to lead virtual, distributed teams. to lead virtual, distributed teams. World in 2021 Summary-Shiv-Dec 31 2020

Instead of valuing charisma and confidence, Instead of valuing charisma and confidence, remote teams value leaders who are remote teams value leaders who are organized, productive and facilitate organized, productive and facilitate connections between colleagues. In a post connections between colleagues. In a post pandemic world, companies will have to retain pandemic world, companies will have to retain and promote these types of leaders. and promote these types of leaders. World in 2021 Summary-Shiv-Dec 31 2020

Top 10 fastest growing economies in 2021 Top 10 fastest growing economies in 2021 Country Growth % Macau 35.4 Guyana 23 Libya 20.9 British Virgin Islands 11.5 Sint Maarten 9.3 Peru 9.2 Albania 8.5 Antigua and Barbados 8 Maldives 8 St Lucia 8 World in 2021 Summary-Shiv-Dec 31 2020

GDP per capita, $ at purchasing power parity GDP per capita, $ at purchasing power parity Country 2010 = Index 100 2021 China 100 210 India 100 163 Germany 100 145 USA 100 130 Britain 100 128 Canada 100 126 S Africa 100 105 Brazil 100 105 World in 2021 Summary-Shiv-Dec 31 2020

Key European Country Economic indicators 2021 Key European Country Economic indicators 2021 GDP Growth % GDP per head $ GDP per head PPP $ Inflation % Budget balance% Population Mln Finland 2.4 50,780 51,330 1.2 (4.3) 5.5 France 7.1 43,000 49,670 1.5 (7.4) 65 Germany 4.6 48,160 56,870 1 (3.6) 83 Italy 5.8 33,630 42,610 0.8 (5.2) 60 Netherlands 4.1 55,980 59,140 1.1 (2.1) 17.4 Russia 3 10,540 28,470 3.9 (2) 149 Spain 6.8 29,600 40,450 0.9 (7.4) 47 Switzerland 3.5 84,770 70,270 0.3 (1.2) 8.7 Turkey 3.6 7690 29,900 10.8 (4.8) 85 UK 6.9 40,290 47,130 0.5 (7.1) 68 World in 2021 Summary-Shiv-Dec 31 2020

Key Asian Country Economic indicators 2021 Key Asian Country Economic indicators 2021 GDP Growth % GDP per head $ GDP per head PPP $ Inflation % Budget balance% Population Mln Australia 1.6 56,700 53,160 1.5 (5.6) 25.8 Bangladesh 5.8 2200 5550 5.6 (6.8) 166 China 7.3 11,300 18,710 3.1 (5) 1400 India 6.7 2150 6850 4 (6.8) 1390 Indonesia 4.3 4260 12840 3.2 (6) 270 Japan 1.7 39,950 42,060 0.5 (8.7) 126 Malaysia 5 10,620 28,330 1.3 (6.9) 33 New Zealand 1.4 40,760 41,680 1.6 (7.8) 5 Pakistan 0.8 1180 4690 6 (7.6) 225 Philippines 5.8 3610 9150 3.2 (6.8) 111 Singapore 3.9 64,190 101,990 1.3 (6.6) 5.6 Sri Lanka 2.3 3940 13580 5.1 (8.5) 22 Thailand 3.2 8000 18,940 1.1 (5.1) 70 World in 2021 Summary-Shiv-Dec 31 2020

Key Americas Country Economic indicators 2021 Key Americas Country Economic indicators 2021 GDP Growth % GDP per head $ GDP per head PPP $ Inflation % Budget balance% Population Mln Canada 4 45,930 50,650 1.5 (8.3) 38 Mexico 3.3 8,940 19,160 3.9 (3.2) 130 USA 3.6 64,790 64,790 1.7 (9.2) 333 Brazil 3 6940 15040 2.9 (7.5) 213 World in 2021 Summary-Shiv-Dec 31 2020