Good Book Recommendation: A More Turbulent Future Economy

        Author: Stephen Poloz

        Publishing House: Shang Zhou Publishing

        Publication date: September 7, 2023

                The global political and economic situation in 2023 is unpredictable: inflation has become the new normal, pressure to raise interest rates continues, and the economic recovery is not as expected; The ongoing conflict between Russia and Ukraine, the resurgence of the Israeli Palestinian conflict, the unresolved conflict between China and the United States, and the escalating geopolitical risks; In addition, the frequent occurrence of extreme weather events, changes in supply chain patterns, difficulty in controlling raw material prices, shortage of manpower, technological innovation, and net zero competition are all testing the adaptability of governments and enterprises in various countries.

        In a rapidly changing environment, business leaders must have a closer understanding of the various factors that cause change. The book "A More Turbulent Future Economy" was written by former President of the Bank of Canada, Stephen Poloz, to describe the five major structural forces that affect the global economy: population aging, technological progress, increasing inequality, high debt, and climate change. These forces have been operating for a long time and are mutually reinforcing. For example, in the trend of declining labor force caused by population aging, promoting technological progress becomes the best solution; However, every technological advancement in history has widened the income gap between different social classes, leading to a continuous deterioration of income inequality; And the high debt burden is closely related to income inequality, which may interact with climate change and bring greater financial burden to heavily indebted governments.

        The five structural forces not only continue to operate and develop themselves, but also interact and strengthen each other, causing greater economic shocks. It is worth mentioning that although COVID-19 has exacerbated the impact of some structural forces, it has also brought important insights - risk management, crisis management processes such as human resources and technological support in response to the epidemic, helping enterprises become more resilient organizations. Faced with more uncertainty in the future, including new challenges such as inflation, employment market, housing supply, social welfare, etc., the difficulty of government policy formulation has increased, which in turn hinders enterprises from making long-term plans. In order to continuously create value, enterprises must be flexible at all times and invest meaningful resources in risk management.

        In addition, as world politics becomes increasingly confrontational and complex, the ideal of governments safeguarding the economy from the impact of risks is becoming increasingly unrealistic. In other words, businesses must take greater responsibility for future risks. If more efforts can be invested in the social responsibility aspect of ESG, it can be seen as an opportunity to create new competitive advantages over other companies, because when public values become the values of the company and its leadership, interests can naturally be maximized.

        The uncertainty of the future is ubiquitous, and the focus of this book is not on prediction, but on identifying dynamic forces in the environment and thinking about how they will evolve. Despite the increasing environmental risks, the power of green environmental investment, the rise of ESG accountability, business roundtable meetings, and other forms of stakeholder capitalism also reflect people's ability to adapt to the next uncertain era and continue prosperous development. I hope that all leaders can calmly respond with a more macro and wise perspective, seize potential opportunities, turn crises into turning points, and "Pooling Energy to Create Intelligent Future"!

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