The World in 2016

The Economist's annual look at the year ahead hit our mailbox this week. It always makes interesting reading. Here is a small selection of the issues it touches on:

• A dramatic graph shows how, in recent years, real global GDP growth is increasingly being driven, not by developing countries as in recent years, but by the developed world. From 2010 to 2013, emerging markets, particularly the BRICS grouping of Brazil, Russia, India, China and South Africa, have generated a much larger, and increasing proportion of the world's GDP growth. Since 2014, however, the trend has dramatically reversed, largely as a result of economic problems in China, Brazil and Russia, and this looks set to continue into 2016.
• Britain is due to hold a referendum on whether it should remain in the European Union some time before the end of 2017 and, for various reasons, this is most likely to happen sometime in 2016. David Cameron's pro-Europeans are still expected to sneak a slim win, and he has inertia on his side. But, with the British economy out-performing that of most of the rest of Europe, and concern about immigration from the Middle East at fever pitch, a Brexit result is a distinct possibility. This is regardless of the negative economic consequences that would almost certainly ensue, and the strong likelihood that Scotland would then finally secede from the Union. If Britain does exit, it will surely never be allowed to rejoin.
• A United Nations General Assembly Special Session (UNGASS) on drug policy will convene in 2016, for the first time since 1998. Back in 1998, there was an almost unanimous agreement on the need for severe regulation and the complete eradication of the drug trade. In 2016, the situation is much more complex. The 1998 policies are acknowledged as a failure (cannabis and cocaine consumption are 50% up, opiate use has nearly trebled, and new synthetic drugs are everywhere), and the trend is towards legalization and decriminalization (Portugal has decriminalized all drugs; Uruguay and four American states have legalized marijuana, with more states and Canada expected to follow soon; the Netherlands continues to turn a deliberate blind eye to pretty much everything; and many other countries are looking for alternatives to prohibition).
• 2016 is also Olympics year, with Rio de Janeiro hosting. Olympic preparations there have been plagued with problems and scandals, but the odds are that facilities will be up and running (just) in time. The predicted medal count favours the usual suspects (USA, China and Russia, in that order), but what might be more interesting is how Brazil's embattled president Dilma Rousseff emerges from the experience, whether there are major political demonstrations or riots, how Russia's recent bad-boy attitude plays out in the sporting arena, and whether the current drug and doping culture in sports rears its ugly head (an estimated one-in-seven track athletes showed results "highly suggestive of doping" during tests in August 2015). Rio may turn out to be a litmus test of the world's attitudes towards the current Olympics paradigm.
• And, lest we forget, November 2016 will see the US election. To outsiders, it already seems to have been going on forever, as we watch, open-mouthed in disbelief and disgust, the unedifying spectacle of the Republican leadership contest. Assuming that Republicans finally come to their real-world senses, they will probably end up with an unexciting and unobjectionable candidate like Marco Rubio; barring major upsets, the Democratic candidate will almost certainly be the unloved but safe Hilary Clinton. Who actually wins the actual election will probably be more about how the American economy with world events in the meantime: if global forces derail America's economic recovery in 2016, the incumbent Democrats will probably lose; if not, they may still sneak in, despite the historical odds against a third consecutive term of power. In that case, Mrs Clinton will almost certainly be hampered by a Republican House of Representatives, and probably the Senate too.
• One interesting graph illustrates the strong positive correlation between the income inequality of a country and its index of health and social problems. The USA is way out ahead of the pack in both these metrics, followed (perhaps unexpectedly) by Portugal and then Britain, while at the other end of the scale are equality-conscious Scandinavian countries and (unexpectedly for me) Japan, with Canada appearing in the middle of the pack. One mind-boggling statistic mentioned is that the average CEO of an American company made 42 times as much as its average employee in 1980; in 2015, that ratio was 373 to 1. In 2016, of course, it will be even worse.
• It's always interesting to see how other parts of the world see Canada and its role in world affairs. Here on the ground, it feels like almost everything has changed since October's election ended years of Conservative retrenchment and inaction, so I was surprised to see The Economist's assessment that Canada will merely look and sound different, hiding an underlying business-as-usual reality. However, the article then goes on to list the many ways in which the country will in fact change (increased openness; investment in infrastructure, clean-tech and greenhouse gas mitigation; improved relations with the provinces; more emphasis on Canada's traditional international roles of humanitarian aid and peacekeeping; a liberalizing of abortion practices and cannabis use; etc, etc). Business as usual? Hardly.
• 2016 seems likely to see an increase in the economic and political rivalry between the world's top two superpowers, the USA and China, particularly in and around Asia itself. Among issues that may come to a head next year are: China's creation of artificial islands in disputed waters in the South China Sea; the establishment of both Chinese and American military bases in the region; Chinese opposition to American bilateral agreements with several countries in Asia, and especially its support of Taiwan (which also sees an election early in the New Year); the potential trade effects of the Trans-Pacific Partnership (which excludes China), and the China-dominated Asian Infrastructure Investment Bank.
• Economic growth in China is expected to be "only" about 7% in 2016, down from the heady days of double-digit expansion. But what is interesting is that much of that growth will come courtesy of a bunch of second-tier cities that I, for one, have never even heard of. China's top ten emerging cities are: Guiyang, Xiangyang, Hengyang, Chongqing, Suqian, Huainan, Huaibei, Zhuzhou, Zhengzhou and Chengdu. Other unknown cities, such as Urumqi and the aptly-named Wuhu are likely to enjoy the fastest income growth and fastest growth in consumer spending.
• One of the important developments in science and medicine which will come to the fore in 2016 is the use of organoids, simulacra of brains, livers, kidneys, intestines and many other body parts, ethically grown from stem cells of a patient, so that they have the genetic characteristics of that individual. Thus, drugs and other treatments can be tested, non-invasively, to see how the individual's actual body would react.
• And, finally, a few milestones that will be achieved during 2016, according to extrapolations of various charts and graphs: the share of wealth of the world's richest 1% will exceed that of the remaining 99%; the amount of global crowd-funding investment will exceed that committed by investors to venture-capital funds; annual Internet traffic will enter into zettabyte territory (a trillion gigabytes), largely on the back of the demand for online video content; speaking of which, Netflix is expected to have a larger ratings audience than ABC, CBS, NBC or Fox; and over half of the children born in Britain will be born "out of wedlock" (the equivalent statistic 40 years ago was 10%).