2025 :: Want To Make God Laugh? Tell Him Your Plans.

Nov 28, 2008 16:07

On Education:

The US lead in highly skilled labor will likely narrow as large developing countries, particularly China, begin to reap dividends on recent investments in human capital, including education but also nutrition and healthcare. India faces a challenge because inadequate primary education is widespread in the poorer regions and top-flight educational institutions cater to a relatively privileged few.

On Energy:

We believe the most likely occurrence by 2025 is a technological breakthrough that will provide an alternative to oil and natural gas, but implementation will lag because of the necessary infrastructure costs and need for longer replacement time. However, whether the breakthrough occurs within the 2025 time frame or later, the geopolitical implications of a shift away from oil and natural gas will be immense.
Long-lasting hydrogen, fuel cells have potential, but they remain in their infancy and are at least a decade away from commercial production. Enormous infrastructure investment might be required to support a “hydrogen economy.” An Argonne National Laboratory study found that hydrogen, from well to tank, is likely to be at least twice as costly as gasoline.
The pace of technological innovation will be key to outcomes during this period. All current technologies are inadequate for replacing traditional energy architecture on the scale needed.

By 2025 the world will be in the midst of a fundamental energy transition-in terms of both fuel types and sources. Non-OPEC liquid hydrocarbon production (i.e., crude oil, natural gas liquids, and unconventionals such as tar sands) will not be able to grow commensurate with demand. The production levels of many traditional energy producers- Yemen, Norway, Oman, Colombia, the UK, Indonesia, Argentina, Syria, Egypt, Peru, Tunisia-are already in decline. Others’ production levels-Mexico, Brunei, Malaysia, China, India, Qatar-have flattened. The number of countries capable of meaningfully expanding production will decline. Only six countries-Saudi Arabia, Iran, Kuwait, the UAE, Iraq (potentially), and 42 Russia-are projected to account for 39 percent of total world oil production in 2025. The major producers increasingly will be located in the Middle East, which contains some two-thirds of world reserves. OPEC production in the Persian Gulf countries is projected to grow by 43 percent during 2003-2025. Saudi Arabia alone will account for almost half of all Gulf production, an amount greater than that expected from Africa and the Caspian area combined.

Central Asia has become an area of intense international competition for access to energy. Although Russia and China currently are working cooperatively to reduce the leverage of outside powers, especially the United States, competition between the two in Central Asia could escalate if in the future Russia seeks to interfere with China’s relations in the region or China becomes more aggressive in obtaining its access to energy supplies in parts of the former Soviet Union.

On Europe:

Western Europe’s Muslim population currently totals between 15 and 18 million. The largest proportions of Muslims-between 6 and 8 percent-are in France (5 million) and the Netherlands (nearly 1 million), followed by countries with 4 to 6 percent: Germany (3.5 million), Denmark (300,000), Austria (500,000), and Switzerland (350,000). The UK and Italy also have relatively large Muslim populations, 1.8 million and 1 million respectively, though constituting less overall proportions (3 percent and 1.7 percent respectively). If current patterns of immigration and Muslim residents’ above-average fertility continue, Western Europe could have 25 to 30 million Muslims by 2025. Countries with growing numbers of Muslims will experience a rapid shift in ethnic composition, particularly around urban areas, potentially complicating efforts to facilitate assimilation and integration. Economic opportunities are likely to be greater in urban areas, but, in the absence of growth in suitable jobs, the increasing concentration could lead to more tense and unstable situations, such as occurred with the 2005 Paris surburban riots.



On Economy:

Economic volatility introduces a major risk factor. Historians and social scientists have discovered a strong correlation between rapid economic change-both positive and negative-and political instability. The massive dislocation and economic volatility introduced by the end of the “first” globalization in 1914-1918 and the rise of protectionist barriers in the 1920s and 1930s, combined with the lingering resentments over the Versailles peace settlement, laid the groundwork for WW II. The collapse of multinational and ethnic empires-begun after WW I and continuing with the end of the colonial empires in the post-WW II period-also unleashed a long series of national and ethnic conflicts that reverberates today. Today’s globalization also has spurred the movement of people, disrupting traditional social and geographic boundaries.

The dollar is vulnerable to a major financial crisis and the dollar’s international role is likely to decline from that of the unparalleled “global reserve currency,” to something of a first among equals in a basket of currencies by 2025. This could occur suddenly in the wake of a crisis, or gradually with global rebalancing. This decline will entail real tradeoffs and force new, difficult choices in the conduct of American foreign policy.

On Shadow Economy:

A “Shadow” International System by 2025? Further fragmenting the international system is the threat posed by growing transnational criminal networks in managing the world’s resources-especially global energy, minerals, and other strategic markets-in addition to their traditional involvement in international narcotics trafficking. Increased demand for energy worldwide provides opportunities for criminals to expand their activities through direct ties to energy suppliers and leaders of countries where suppliers are located. With energy supplies increasingly concentrated in countries with poor governance, longstanding practices of corruption, and an absence of the rule of law, the potential for penetration by organized crime is high.
As Russian and Eurasian suppliers capture a larger and larger portion of the energy markets in Europe and Asia, we expect these organized crime networks to expand their operations, fostering greater corruption and manipulation of foreign policies to their advantage.

On Tech:

“Biogerontechnology” is the science related to the study of the cellular and molecular basis of disease and aging applied to the development of new technological means for identifying and treating diseases and disabilities associated with old age. Supporting technologies include improvements in biosensors for real-time monitoring of human health, robust information technology, ubiquitous
DNA sequencing and DNA-specific medicine, and fully targeted drugdelivery mechanisms.

Human cognitive augmentation technologies include drugs, implants, virtual learning environments, and wearable devices to enhance human cognitive abilities. Training software exploits neuroplasticity to improve a person’s natural abilities, and wearable and implantable devices promise to improve vision, hearing, and even memory. Bio and information technologies promise enhanced human mental performance at every life stage.

Energy storage technology encompasses a wide range of materials and techniques for storing energy, a necessity for the viability of many alternatives to fossil-fuel energy sources. Included are battery materials, ultracapacitors and hydrogen storage materials (particularly for fuel cells). Efficient energy storage will enable the on-demand energy component of a variety of systems such as hydrogenbased energy systems, a host of renewable (but intermittent) energy sources such as wind and solar, and low-emission transport vehicles.

On Military:

More Limited Military Superiority In 2025, the US will still retain unique military capabilities, especially its ability to project military power globally, that other nations will continue to envy and rely on to secure a safer world. The United States’ ability to protect the “global commons” and ensure the free flow of energy could gain greater prominence as concerns over energy security grow. The US also will continue to be viewed as the security partner of choice by many states confronted with the rise of potential hostile nuclear powers. Although the emergence of new nuclear-weapon states may constrain US freedom of action, US military superiority in both conventional and nuclear weapons and missile defense capabilities will be a critical element in deterring openly aggressive behavior on the part of any new nuclear states. The US will also be expected to play a significant role in using its military power to counter global terrorism.

On Russia:

Russia’s Path: Boom or Bust. Russia has the potential to be richer, more powerful, and more self-assured in 2025 if it invests in human capital, expands and diversifies its economy, and integrates with global markets. On the other hand, multiple constraints could limit Russia’s ability to achieve its full economic potential. Chief among them are a shortfall in energy investment, key infrastructure bottlenecks, decaying education and public health sectors, an underdeveloped banking sector, and crime and corruption. A sooner-than-expected conversion to alternative fuels or a sustained plunge in global energy prices before Russia has the chance to develop a more diversified economy probably would constrain economic growth. Russia’s population decline by 2025 will force hard policy choices. By 2017, for example, Russia is likely to have only 650,000 18-year-old males from which to maintain an army that today relies on 750,000 conscripts. Population decline also could take an economic toll with severe labor force shortages, particularly if Russia does not invest more in its existing human capital, rebuild its S&T base, and employ foreign labor migrants. If Russia diversifies its economy, it could develop a more pluralistic, albeit not democratic, political system-the result of institutional consolidation, a rising middle class, and the emergence of new stakeholders demanding a greater voice. A more proactive and influential foreign policy seems likely, reflecting Moscow’s reemergence as a major player on the world stage; an important partner for Western, Asian, and Middle East capitals; and a leading force in opposition to US global dominance. Controlling key energy nodes and links in the Caucasus and Central Asia-vital to its ambitions as an energy superpower-will be a driving force in reestablishing a sphere of influence in its Near Abroad. Shared perceptions regarding threats from terrorism and Islamic radicalism could align Russian and Western security policies more tightly, notwithstanding disagreements on other issues and a persisting “values gap.” The range of possible futures for Russia remains wide because of starkly divergent forces-liberal economic trends and illiberal political trends. The tension between the two trends-together with Russia’s sensitivity to potential discontinuities sparked by political instability, a major foreign policy crisis, or other wild cards-makes it impossible to exclude alternative futures such as a nationalistic, authoritarian petro-state or even a full dictatorship, which is an unlikely but nevertheless plausible future. Less likely, Russia could become a significantly more open and progressive country by 2025.

Russia: A Growing Multiethnic State? Currently a country with around 141 million people, Russia’s demographically aging and declining population is projected to drop below 130 million by 2025. The chances of stemming such a steep decline over this period are slim: the population of women in their 20s-their prime childbearing years- will be declining rapidly, numbering around 55 percent of today’s count by 2025. Russia’s high rate of male middle-age mortality is unlikely to change dramatically. Muslim minorities that have maintained higher fertility will comprise larger proportions of the Russian population, as will Turkic and Chinese immigrants. According to some more conservative projections, the Muslim minority share of Russia’s population will rise from 14 percent in 2005 to 19 percent in 2030, and 23 percent in 2050. In a shrinking population, the growing proportion that are not Orthodox Slavs will likely provoke a nationalist backlash. Because Russia’s fertility and mortality problems are likely to persist through 2025, Russia’s economy-unlike Europe’s and Japan’s-will have to support the large proportion of dependents.

On China:

Back to the Future. Asia’s economic powerhouses-China and India-are restoring the positions they held two centuries ago when China produced approximately 30 percent and India 15 percent of the world’s wealth. China and India, for the first time since the 18th century, are set to be the largest contributors to worldwide economic growth. These two countries will likely surpass the GDP of all other economies except the US and Japan by 2025, but they will continue to lag in per capita income for decades. The years around 2025 will be characterized by the “dual identity” of these Asian giants: powerful, but many individual Chinese or Indians feeling relatively poor compared to Westerners.

Asian integration could lead to more powerful regional institutions. NATO faces stiff challenges in meeting growing out-of-area responsibilities with declining European military capabilities. Traditional alliances will weaken.

China is poised to have more impact on the world over the next 20 years than any other country. If current trends persist, by 2025 China will have the world’s second largest economy and will be a leading 2 National power scores, computed by the International Futures computer model, are the product of an index combining the weighted factors of GDP, defense spending, population, and technology. It also could be the largest importer of natural resources and the biggest polluter. India probably will continue to enjoy relatively rapid economic growth and will strive for a multipolar world in which New Delhi is one of the poles. China and India must decide the extent to which they are willing and capable of playing increasing global roles and how each will relate to the other. Russia has the potential to be richer, more powerful, and more self-assured in 2025 if it invests in human capital, expands and diversifies its economy, and integrates with global markets. On the other hand, Russia could experience a significant decline if it fails to take these steps and oil and gas prices remain in the $50-70 per barrel range. No other countries are projected to rise to the level of China, India, or Russia, and none is likely to match their individual global clout.

We put uncertainties such as whether China or Russia becomes a democracy in this category. China’s growing middle class increases the chances but does not make such a development inevitable. Political pluralism seems less likely in Russia in the absence of economic diversification. Pressure from below may force the issue, or a leader might begin or enhance the democratization process to sustain the economy or spur economic growth. A sustained plunge in the price of oil and gas would alter the outlook and increase prospects for greater political and economic liberalization in Russia. If either country were to democratize, it would represent another wave of democratization with wide significance for many other developing state

Global Trends 2025: A Transformed World by National Intelligence Council.
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