The Coming Economic Hierarchy: Future Preparedness Index

01.03.2017

How to discover what will happen tomorrow? How to assess the readiness of states to the long-term challenges of the global economy? What are the contours of the economy of the future? These and other questions were answered by the participants of a panel discussion, titled "The coming economic hierarchy: Future Preparedness Index", which was held on February 28 in Sochi within the framework of the Russian Investment Forum.

Andrey Bystritskiy, Chairman of the Board of the Foundation for Development and Support of the Valdai Discussion Club, opened the discussion. He informed the audience about the joint project of the Valdai Discussion Club and VTsIOM. One of its main objectives is to analyze the preparedness of countries to respond to the challenges of tomorrow. "Future Preparedness Index is a complex, multi-dimensional, multi-factor [project], we are now in its pilot phase. <...> It allows to understand what features define today what will happen tomorrow, to give distinctness to forecasting and structuring "- Andrey Bystritskiy said.

Valery Fyodorov, Director General of VTsIOM,  said that the work on the index was initiated at the Annual meeting of the Valdai Discussion Club in Sochi in October 2016. According to him, the main idea of the project is "to see the future through the present, draw possible outlines for the next 15 years." "The need for forecasting, for anticipation, becomes more sensitive in moments when it is the least possible ... We are engaged in a very important and delicate matter, because now we really are at a turning point," - Fyodorov said.

Speaking of key evaluation criteria of the Index countries (there are 10 of them), Fyodorov drew attention to education - namely, the continuous and mobile education, i.e. the ability to learn throughout life. If we talk about science, there is a need to take into account the level of state support, financing, promotion of scientific breakthroughs. Among other things, the index covers the enormous role of culture, the availability of communications, quality of life, resources, security, governance, international status and national prestige of the country.

Yaroslav Lissovolik, Chief Economist of the Eurasian Development Bank and Programme director of the Valdai Discussion Club,  in his turn noted, that the construction of forecasts of the future is a very difficult task. For this purpose it is necessary not only to analyze the current economic situation in a country, but also the dynamics of the global economy. According to Gerschenkron's principle, catching-up economies are in a better situation if compared with the leaders, as they have an example, they see the development of other countries and can orientate themselves, avoiding the same mistakes. But this scenario does not always work, because the political and social factors hamper development and increase inequality. Moreover, the desire to catch up on the leaders lead, according Lissovolik, to an internal breakdown, as it happened with China, which showed a record steady growth for 20 years, and has now reached its peak.

Andrei Klepach, Deputy Chairman (Chief Economist) and Member of the Board of Vnesheconombank, said that the prediction and building of the future requires an analysis of the past, understand what has been succeeded or failed. "So far, lessons of the past have been learned very poorly", - he said. Individual parameters, according to Klepach, should become "the ability to fully revive the nation and the state", because in the last hundred years, for example, in Russia, there was a war or a crisis at least every of 10-15 years, during which there was weak growth.

The expert noted the very high potential of the Russian science, particularly when it comes to the defense and nuclear industries, and called one of the major problems in the economy the inability to convert advantages into income. "In compiling the index, it is necessary to take into account for the strengths of Russia, which are underestimated," said Klepach.

Svetlana Chupsheva, General Director for new projects at the Agency for Strategic Initiatives (ASI), spoke about the impact of economic development on the country's future. "The future is inevitable. And building blocks we enter it with, will decide our competitive advantages in terms of economy and global competition," she said.

One of the most important aspects of the future is robotics, said Ekaterina Trofimova, CEO of the rating agency ACRA. According to her, the machines will soon replace man in many areas. Therefore, it is necessary to decide now how to provide jobs for thousands of people, as well as to understand, whether such a future is desirable, or whether another path of development has to be found.

According to Evgeny Kuznetsov, Deputy CEO and Program Director at the Russian Venture Company (RVC), the states took a more responsible approach to future planning strategies in the past, building up cooperation and restricting the use of weapons of mass destruction. Today, there are no discussions conducted in the legal field about the potential danger of the failure of cyber systems that control the types of strategic weapons, or the development by the invasion of the human genome.

"Now we are less prepared for the future than previous generations," - Kuznetsov said. To compensate this the Valdai Discussion Club and RVC launched a joint project, titled "Club-2035". One of its objectives is to prepare scenarios of socio-economic and socio-political consequences of the accelerated technological development on the horizon of 2035. "The future is a complex, heterogeneous environment and we must be ready for it very seriously, adapting to changing conditions," – Kuznetsov concluded.