The world is constantly evolving, and this creates opportunities and challenges.
Some of the key trends that businesses will have to navigate this year include economic volatility, the continued importance of environmental sustainability, geopolitical uncertainty and AI moving into the mainstream.
Economic volatility will remain a risk in 2024. The higher interest rate environment will continue to make borrowing expensive for businesses in the short to medium term. Rate cuts are on the horizon but a significant reduction in interest rates in 2024 is unlikely. The global economy faces the prospect of slow growth this year as businesses and consumers continue to grapple with ongoing cost pressures.
Environmental sustainability is very much on the radar this year. At the COP28 meeting last December, progress was made on the new collective quantified goal (NCQG), which builds on the $100 billion pledged by developed nations to finance climate mitigation and adaptation initiatives in developing nations. Global targets to increase the capacity of renewable energy sources such as wind and solar power were also agreed. Businesses across the world will need to play their part.
Geopolitical uncertainty will remain a key challenge this year due to the upcoming UK general election and the US presidential election. This, combined with the continued war in Ukraine, tension in the Middle East and a slowdown in the Chinese Economy could make for a challenging year.
As AI moves into the mainstream, it will drive efficiencies across various different business sectors and has the potential to turbocharge the digital economy. As AI technology is deployed into real-world uses, it will drive considerable change. Tech companies will benefit hugely from this but the potential for businesses to benefit is very significant in that they can utilise this technology to drive efficiency and increase profit margins. New tools are already coming on stream, and this is likely to accelerate as the year progresses.
