‘Megatrends’ to challenge governments

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Governments must prepare for “global megatrends” that may significantly impact the business landscape for the public and private sector through 2030, a global report said.

According to “Future State 2030,” government needs to plan, think and act differently, in some cases drastically, if they are to be prepared for the global megatrends increasingly straining the world’s resources and economic capacity.

The report discussed nine global megatrends such as demographics, rise of the individual, enabling technology, economic interconnectedness, public debt, economic power shift, climate change, resources stress, and urbanization.

The study said that the nine megatrends face governments at all levels around the world, and assesses policy and strategic actions governments need to take beginning today to be successful in the future.


The megatrends encompass some of the world’s most critical challenges, including resource scarcity; a tidal wave of young people entering the labor force in developing economies; an expanding and more technology adept and connected middle class exerting greater demands on government in the face of rising public debt; and economies becoming increasingly interconnected and interdependent
“Understandably, governments have been focused on the short-term due to multiple factors, including the global financial crisis and its aftermath,” said Nick Chism, global head of Government and Infrastructure of KPMG International.

“But we are now at a critical juncture for governments to take a longer view of accelerating social and environmental challenges. Without significant changes, the impact of these nine megatrends will far outstrip governments’ ability to meet the needs and demands of stakeholders in the next 20 years,” he added.

Meanwhile, the report stated that the megatrends are highly interconnected but will not impact every part of the world in the same way.

This means governments will need to undertake a variety of responses, and consider the implications both within their own jurisdictions and more broadly.

The report presents KPMG’s strategic review of the policy, regulatory and program changes governments will need to consider, as well as the strategies, structures and skills required to effectively implement these needed changes.

“The impact of the megatrends is not limited by borders,” Chism said, adding that as a result, governments cannot respond effectively in isolation and will need to increasingly work collaboratively to find effective solutions.

“New regulatory approaches will be required that recognize the interconnected nature of the risks as well as the rebalancing of global economic power and influence that will increasingly favor developing economies,” he said.

The report added that to deliver effective programs in a rapidly changing operating environment, governments will need to take a hard look at their own skills and capabilities, including risk assessment and change management, stakeholder engagement, and evolving their international awareness, all with a longer-term planning horizon.

“We at KPMG in the Philippines believe that ‘Future State 2030’ publication is a useful guide for policymakers and public servants as they understand and respond to some of the world’s megatrends driving change into 2030,” Emmanuel Bonoan, chief operating officer and vice chairman for Tax of Manabat Sanagustin & Co., the Philippine member-firm of KMPG International.

The “Future State 2030” report was published by KMPG International and developed in partnership with The Mowat Centre at the School of Public Policy and Governance at the University of Toronto.

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