2020-2040: Exponential global development

pic GEAB 126

The world is on the brink of a wave of unprecedented development which is poised to sweep over the Middle East, Africa, India, Southeast Asia, the United States and the planet as a whole. The foundations on which this new world will be built are becoming clearer and clearer: A globalised electric grid, networks of financial centres, new commercial roads, crypto-currencies, e-economies, reinvented global governance etc. All these provide the infrastructure which will shape this unimaginable phase of multipolar and multiconnected development, which we will attempt to describe in the following paragraphs.

Exponential or explo-sive?
If we look at the growth of world GDP since 1960,[1] we see that it is growing at a surprisingly steady rate, with the exception of one recessive jolt in 2008-2009. This is not really surprising since the production of wealth has been intrinsically dependent on the presence of raw materials to be processed, on the labour available to produce, on the quantity of solvent consumers to transform this production into cash, on sufficient money to reinvest and on well-trained brains to constantly reinvent the process. In the real world, all this raw material for growth is only available in limited quantity, thus providing a strict framework for potential growth.

fig1Growth of Global GDP (%), 1960-2016. Source: World Bank

However, from 2020, we are expecting a trend towards a triple paradigm shift in growth limits:

  • Firstly, with the arrival on the world production market of a whole series of new regions bringing along human resources, raw materials and innovative brains. But this increase is still based on materiality where growth is extended through the adjunction of. 1.2 billion Africans, 430 million South Americans, 70 million Centro-Asians, 640 million south-eastern Asians and 1.2 billion Indians.[2]
  • Secondly – and this is where we start talking about exponential development and no longer of simple acceleration – the transition to an e-economy will literally dissociate growth from material goods (human, energy, monetary). Artificial intelligence, increasing dematerialisation of consumer products, a monetary system freed from the issuing capacities of central banks alone; all this is already on the table, but we have not seen anything (especially in the West) of the real potentialities that it creates, knowing that this year, $1 trillion has gone into the digital transformation of society;[3]
  • Finally, let us add that growth will also be liberated from planet Earth thanks to an unlimited conquest of space, now fully open for trade (space economy). [4]

The exponential characteristics seen in this phase of development not only make it possible to draw attention to the opportunities, but also to the risks of such a rapid change – risks that will require the presence of global instances of process control.
E-economy: We haven’t seen anything yet (Register to read this chapter)
Cryptocurrencies… changing our relation to money (Register to read this chapter)
Power/electrical energy supply: Optimisation of invariants (Register to read this chapter)

Global Electricity Grid or World Energy Community
We would like to recall in these pages that the first stage of European construction, as conceived at the end of the Second World War, consisted in pooling the industrial resources through which the conflict had arrived. In 1954, for example, European leaders inaugurated the European Coal and Steel Community (ECSC). [5] If the Europeans do not share much anymore,[6] the principle behind this decision is still universal and it applies perfectly as the raison d’être of all governance worthy of the name, global governance in particular. Thus, we have already anticipated/hoped for the eventual creation of a ‘world oil and gas community’ or ‘energy community’, without defining the means, since the 1952 model is certainly outdated. It is in this context of reflection that we have recently discovered the existence of an incredible plan for a Global Electricity Network that the Chinese have already largely started to set up.[7] This project seems to us to be able to serve, at global level, the same ambitions as the ECSC.

On the basis of ultra-high voltage (UHV) cabling technology that the Chinese have developed and that can transport huge amounts of electricity for a very low price – including installation – Chinese power companies are now setting up an immense power grid that, far beyond the New Silk Road, is already crossing the planet, distributing through Asia, every corner of Africa, North and South America, the Caribbean, Southern Europe and Russia and also Australia. This network is organised around production hubs connected to each other and redistributing electricity around each other.

Laos, for example, where the Chinese built huge dams, but which was an electricity trap given the small size of its domestic market, has become the crossroads of electricity distribution to South East Asia.

Supporters of the project insist that China does not control the network. It is actually an ‘Internet’ (or ‘worldwide web’) of electricity, in which the main contribution of the Chinese is to make available their cabling technology to which any energy supplier can contribute and any operator have access. This is where our team sees a pool of multi-energy electricity being produced in the world. We believe that such networking of producers and consumers is likely to guarantee the stability and fairness of electricity prices. Do we look naive?

fig2In addition, it seems to us that such an infrastructure could radically transform the supply of energy materials since the energy producers would only have to transform their own resources into electricity, whatever they are, and load them on the network. What a beautiful picture of energy saving and nature preservation strategy! And if we are right, what a nice set of expectations for the future of tanker industry, pipelines and other gas lines (a nice down trend) … And, also, in contrast, a series of electric plant manufacturers (a superb up trend). Not to mention a nice transition to all-electric over the next twenty years (car, heating, etc.), already well underway. 

Summary map of the Internet of tomorrow’s finance (Register to read this chapter)
Urbanisation: Sheltering 2.5 billion new city dwellers (Register to read this chapter)
Governance 4.0: Chinese or collaborative? (Register to read this chapter)
Old World: Other problematic issues (Register to read this chapter)

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[1]    Source: World Bank
[2]    Of course, out of these 3.5 billion individuals, some are already integrated or in advanced phases of integration with growth dynamics, but many (we think of Africa and India in particular) have been largely kept out of the way. They are about to join, though.
[3]    Source: SupplyChainDigital, 13/06/2018
[4]    Source: WEForum, 12/06/2017
[5]    Source : Wikipedia
[6]    Not even a common negotiating force for Russian gas / oil tariffs, even though they finally seem to be getting. Source: OilPrice, 28/06/2018
[7]    Please read this! Source: FT, 07/06/2018 (for the FT, fill in the title « China eyes role as world’s power supplier » in your browser to be able to read the article)