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Gulf Region CEOs Expect Economic Stagnation Until 2021

Source: Conference Board

Nearly twice as many CEOs in the Gulf Region have a bleak view of post-coronavirus economic recovery compared to the global average. C-suite leaders in the Gulf Region do not expect growth to resume until 2021, according to the graphic above from The Conference Board

The COVID-19 crisis impacted the Gulf Region in parallel with the oil crash in April. Gulf Region oil producers were faced with low oil demand and extreme price fluctuations, compounding the long-term impact from COVID-19 on business.  

The IMF predicted in June that these countries would see their economies shrink by 7.6% this year due to the double crises of the pandemic and oil industry crash. But the shock prompted a swift response: Countries in the region are setting records for having tested nearly 50% of their populations. And the Gulf Region has shown a significantly higher COVID-19 recovery rate than the global average at 75% — the global average is 57%.

Cost of Solar Electricity Plummeted in the Last Decade

Source: OurWorldinData.org

Electricity prices are expressed in ‘levelized costs of energy’ (LCOE). LCOE captures the cost of building the power plant itself as well as the ongoing costs for fuel and operating the power plant over its lifetime.

The price of solar electricity dropped by 89% in the last 10 years, becoming the world’s cheapest source of electricity. A learning curve related to the sector’s technology, involving “innovation that reduce[d] the amount of labor, time, energy, and raw materials needed to produce the technology,” resulted in a steep decline in its cost, according to author Ramez Naam. Offshore wind power saw a similar technology learning curve with prices falling by 70%. 

The price of electricity from coal has remained nearly the same, dropping only by $2 per MWh to $109 over the last 10 years. The costs of electricity from wind and solar are now significantly lower than electricity from coal at $41 and $40 per MWh, respectively. 

Increased use of solar and wind electricity would lead to more jobs, lower prices for consumers and a more sustainable environment. “The more renewable energy technologies we deploy, the more their costs will fall. More growth will mean even more growth,” wrote Our World in Data.

Asia-Pacific Embraces AI, While Other Countries Remain Wary

Source: Pew Research Center

More than half of the 20 countries surveyed believe that artificial intelligence brings value to their society, compared to 33%, which believe the technology creates a negative impact. This survey, by Pew Research Center, finds that less than half of the countries surveyed saw this technology having a positive impact on society in terms of job automation.

Views of AI were especially positive in the Asia-Pacific region, with 72% of the public in Singapore and 69% in South Korea seeing it as a good thing for their countries. Not surprisingly so, as many countries in this region have dominated the field of AI. For example, South Korea has the highest robots-to-human workers ratio in the nation, followed by Singapore. Singapore has also expressed a goal of becoming the world’s first “smart nation.” 

The COVID-19 pandemic has accelerated the use of AI technologies. Half of global businesses have increased the speed of incorporating automating tasks in their workday, while many executives see this technology as a key lever for success in 2021.

Global Plastic Waste Is a Major Risk for Everyone

Source: University of Leeds

Every year, nearly 30 million tons of plastic are discarded on land, 50 million tons are burned in the air and 11 million tons are dumped into the ocean, according to a computer model from the University of Leeds, U.K

Plastic waste predominantly comes from high-income countries; however, middle- to low-income countries have less access to waste collection services, thereby producing more poor waste management. Improving waste collection services is the most important factor in reducing plastic pollution, which will require political, societal and corporate support.

Businesses also need to cut back on plastic for global improvements to be made. The packaging industry accounts for the highest use — and waste — of plastic, at 146 million tons in 2015. There are multiple ways that businesses can eliminate waste, such as substituting plastic with compostable materials, and selling products and packaging that are recyclable.

Demand for Housing Soared in 2020, Despite the Pandemic

Source: International Monetary Fund (IMF)

Global housing prices rose by about 71% in 2020, despite COVID-based economic recessions. Of the 50 countries analyzed by the International Monetary Fund, the Philippines experienced the highest increase in housing prices (20% year-over-year), followed by Portugal and Latvia.

The housing market was exposed to many changes this year with record-low mortgage rates and a new motive for people to relocate. As COVID-19 pushed millions into lockdown, people started to re-evaluate the spaces they had been living in, especially during the first six months of the pandemic. This trend may continue as businesses consider extending remote work arrangements for the upcoming months and into the future. 

During the last global recession — nearly a decade ago — house prices decreased by an average of 10%. However, experts are optimistic about the current state of the housing market and predicting that this upward trend of prices will continue in 2021.

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