The (R)evolution of Powers 

The World in 2025

The World is constantly changing. In the history of mankind we have gone through several evolutions and revolutions. From ape to man, from fire to atom power, from walking on earth to walking on the moon and from Caesar to Obama: Mankind is constantly in (R)evolution. In nearing the year 2025 the world will be subject to profound changes. The world population will grow expansively and food, water and energy will become scarcer. New codes of conduct will be necessary to regain consumers trust in the aftermath of the financial crisis, and a battle for the leading world currency appears to be on the way. The question we ask ourselves is: How will these issues play out in the upcoming 15 years and which shifting power dynamics can we expect?

The Power of Money

On January 1st of 2002 the Euro was introduced as the official currency of the European Union. Although its introduction was not supported by everybody, The Euro has stood its ground and even made it through its biggest challenge thus far, the financial crisis. And this strength has not gone unnoticed. The Euro has quickly made itself to be one of the most traded currencies in the world. However, not every country in the Euro zone has passed the test posed by the financial crisis with flying colours. What will be the impact on the Euro when Greece, Ireland or Spain defaults on their debt?

The Dollar was and still is the number one currency in the world. However, its position is crumbling. How long will America be able to uphold its number one position as world trade currency? With the rise of the Euro and the strong position China has placed itself in by buying American debt, a power struggle may be on the way. What will be the consequence when China decides to cash in on its American debt?

Furthermore, oil is traded in Dollars, the Dollar’s most powerful weapon. What will happen when the OPEC decides to switch to the Euro or the Yuan as currency? Will this have a big impact on the power position of the US? Is a power struggle for the world’s most traded currency on the way? And what will be the role of the Euro in the power struggle? Which currency will prevail? What will the world look like in 2025?

The (dis)advantages of growth

Vastly growing populations will have a deep impact on our society. In the upcoming 15 years the world population will grow by approximately 1,2 billion people, creating a strain on the earth’s resources. At the same time water usage will expand by 2,6%. Although the earths surface is covered by water for almost 70% only 0,3% is usable for drinking purposes. Currently numerous regions are already dealing with severe water scarcity and global warming will only accelerate this problem.In addition to the increasing water scarcity, world hunger will also increase over the coming years. For the first time in human history more than 1 billion people do not get sufficient nutrition. In a few years time the situation has deteriorated so rapidly that presently 1 in 6 people do not get enough food to live a normal and healthy life. And in the years leading up to 2025, this situation will only deteriorate. What will the impact of these changes be on the future world population? How will the power be distributed between poor and rich? And what will the effect be on the world price of food and the trade structures that align with a change in these prices?

A subject that has gotten a lot of media attention the last couple of years is the depleting energy resources and the search for sustainable energy to replace these energy resources. But what will happen in 2025 when it becomes apparent that sustainable energy is not yet advanced enough to replace the energy resources? Europe is mainly dependent on Russia for its gas supply. Currently Russia is developing the North Stream, a pipeline enabling Russia to directly supply Europe of gas without having to go through Poland and Ukraine. This will considerably increase the reliability of the gas supply. Europe’s counter effort is the development of the

Nabucco. This pipeline connects the gas-rich Caspian region with central Europe, reducing Europe’s dependency on Russian gas. How will this power play between the countries who own these pipelines play out? Will Russia be able to maintain its leading position? Or will Nabucco even out the playing field?

The two faces of Power

In the search for a scapegoat to blame the financial crisis on, higher management from the banking sector was the most obvious choice.

Unnecessary risks were taken in their efforts to get the highest returns. However, as recent events have shown, taking these high risks led to devastating outcomes. And it became even more apparent that there is a thin line between using power and abusing power.

Strict regulation and codes of conduct are necessary to prevent this kind of mishaps in the future and to regain the trust of consumers in the financial sector. Which changes are necessary to regain this trust? And how can power abuse be called to a halt and be diminished?

However abuse of trust does not only take place within the financial sector. Governments often find themselves in a position of power abuse. The discussion central to government power abuse is the choice between government interference in the market or free market movement. As we have seen in the aftermath of the financial crisis, most governments choose the first option and bailed out their banking sector. Billions were invested to save the banks from bankruptcy. In Great-Britain it even came to a staggering amount of 1000 billion pounds. In times of downturn survival of the fittest is rule, so wouldn’t it have been better to let nature run its course? Desperate times, call for desperate measures, but did the governments cross a line in bailing out the banking sector? Did the governments abuse its power? How will future generations deal with this immense debt?