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1 July, 2008 Economic Development in a Rubik's Cube World: How to Turn Global Trends into Local Prosperity |
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| The world is currently changing at an increasingly rapid pace, driven by six "megatrends": deepening globalization, large scale population trends, accelerating technological progress, the "Omni Consumer," the corporate social responsibility imperative and growing political uncertainty. These trends are forcing companies to innovate and refine their fundamental business models. Investment promotion agencies and economic development organizations must not only deal with all those changes, but also with more intense competition. To do so, they need to understand their clients, environment and competitors, and respond effectively. |
Introduction
Thinking about the world of 2020, it is easy to underestimate the scale of changes likely to happen in less than 15 years. Fifteen years ago, the world was emerging from the end of the Cold War. Almost all business investment came from developed countries and about 80 percent went to other developed countries. Since then, global investment flows have increased almost five-fold. In 1990, there were about 35,000 transnational corporations (TNCs), with an average of four affiliates each. If the period 2005-2020 sees as much change and growth as 1990-2005, we will be living in world of 28,000 international investment projects annually by 2020 - a world in which 140,000 TNCs will have an average of 20 affiliates each.
To gain an insight into the world of 2020 for economic development professionals, the IBM Institute for Business Value reviewed its sector and industry future agenda studies. Its Global Center for Economic Development Research also conducted a review of long-term economic and social forecasts out to 2020, as well as conducting its own economic analysis of major global trends, including investment, technology and globalization. To understand how investment promotion and economic development organizations are preparing for the future, over 250 organizations around the world were surveyed, including clients of the IBM-PLI Global Location Strategies consultancy practice, members of the International Economic Development Council (IEDC) and the World Association of Investment Promotion Agencies (WAIPA).
This white paper was published in July 2008.
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