Headline
Strategic foresight approaches are starting to take a long-overdue role in the toolkits of global executives: this is a hopeful sign for an improving understanding of the future.
About the Interview
In December 2021, PRISM's George Coe and Johan Gott interviewed Bart Edes, Professor of Practice at McGill University, Senior Associate at CSIS, and author of "Learning From Tomorrow." With extensive experience at the Asian Development Bank, Bart shared insights on economic development in Asia and Africa, the potentially exaggerated "China threat" perception in the US, and other intriguing topics.
Key takeaways
Strategic foresight is valuable but underutilized; COVID-19 has initiated change.
Pandemic accelerated trends; higher education faces major transformations, and some institutions risk obsolescence.
US may overestimate China's power; both countries face domestic challenges, potentially easing tensions.
Plausible multipolar world led by US and China; Europe, Africa, and Southeast Asia remain relevant.
Asia's development success shifts focus to Africa and the Middle East.
Demographics predict India becoming the largest country and Africa's increasing global economic importance.
The Interview
This interview has been edited for style and clarity.
PRISM: Let’s just jump into it, Bart. My first question that I wanted to ask you about pertains to China. Would you say that you are more bullish or bearish on China than others?
Bart Edes: I can't really say whether I'm more bearish or bullish on the future of China compared to others, but what I can say is that the narrative that you hear, particularly in Washington, is that China is a big threat, and I think that is very one-dimensional. I spent most of the last four years in Washington, D.C., blocks away from the White House. Over the course of those years there, tensions between the US and China really began to increase – I am talking about really starting to see those changes under the Trump administration but they have continued under Biden, too. Over those years, this extreme skepticism has emerged towards China and with that has come more controls on Chinese investment and companies operating in the US, and an ever growing list of steps are being taken to contain China. Everything that’s happening moves towards decoupling, particularly in high tech areas. So that’s the general atmosphere in terms of thinking about China. In that context, it has been somewhat difficult to start having conversations where you suggest to people that having more collaboration could be a good idea. It’s quite hard to go and say: “Maybe what China's doing is not actually a bad thing.”
There's so much skepticism to any ideas that support the sense that China might be doing positive things. For example, when China announced that it is aiming for net-zero carbon emissions by 2060, very few actually looked at that and said it was a good thing. Instead it ends up immediately receiving pile-on critiques. Ultimately, if China does something that could be good for China but also the world, no one wants to give them kudos. What I’m trying to say is that there's a more nuanced picture that needs to be presented when it comes to China, and many people tend to overlook that.
Right now, Secretary of State Tony Blinken is going to Southeast Asia, and all the conversations are about building up the military and economic alliances to better limit China's influence in the region. There's very little discussion around Well if China is the other superpower what are the ways that the US and China can collaborate? To be fair this administration has done a bit better of a job of recognizing the need to take this approach and to slow the pace of the non-stop degradation of the US-China relationship, which was heading towards calamity at one point.
Coming back to your question on being bearish or bullish, though; I think China has huge assets and it has accomplished quite a lot and has been very focused. At the same time, it is not omnipotent, and that’s often the impression that one gets when you hear people in Washington. Everyone sees China as this huge threat, and has the sense that they are eating our lunch, economically, in terms of their military, and so on. But all of this is happening without sufficient recognition of two things. First, people fail to recognize that collaboration in some areas could be good for the US and the world. Sure, it might benefit China, too, but that is not a bad thing. Second, China is not all powerful. It has profound challenges, including aging, inequality, debt issues, tumult in the real estate sector, state-owned enterprises that are very inefficient, and we can go on and on.
For that reason, I'll conclude by saying that I think we are going to see China become more heavily focused on its own challenges. We might see some of that in the US, too. Of course there will be some international things that happen and the US will attempt to build up its alliances, as it's been doing under Biden, but in China and the US on addressing domestic challenges, like getting out of the pandemic and other longer-term. To me, this means that both countries are going to take a step back – not call a truce – but change their focus away from confronting each other.
PRISM: That makes sense. How do you feel about the idea or theory that the US-China relationship will reach a similar outcome to the US-Japan relationship? That is, that Japan was the US’ bogeyman in the 1980s – there were trade wars and what not – but then at the end of the day everything calmed down and now they are strong allies.
BE: I think that the major difference there is that Japan and the US have been democracies and market economies, and even though there was a great deal of state intervention at the time – and even still today in Japan – it's not the same as what China is doing right now. So, I don't think the situations are comparable. I mean it would be a wonderful outcome, wouldn't it? At the end of the day though, the two countries do not trust each other. Without that, they’ll be rivals. I mean, I'm sitting in Canada right now, and the US and Canada have this great relationship, the longest undefended border in the world, and all the other parts that make the relationship great, but the other day Canada was threatening the US with tariffs. That's part of a normal relationship; disagreements are going to happen, but they happen amid a broader context of an understanding that, when push comes to shove, we've got each other's back.
When you think about the US and China in this context, seeing the two be amicable in the way you described is more challenging to imagine because of fundamental different political systems, values, and the emphasis on individual rights in the US versus a collective approach in China. I mean when you look at how China is dealing with COVID, their approach is totally different: they just crush it, they will not accept it. If there is a surge in infections somewhere and 20 people and a country of 1.4 billion are infected in one city, they just shut the city down. From a Western perspective, that's draconian. Imagine that happening in Chicago. There would be a massive uproar and national implications, with people saying, “How could you lock people up for two weeks?” In China, individuals may not be happy about it, but it is part of a collective mission where the idea is: “We will not let COVID-19 decimate our economy or prevent us from growing.”
So getting back to that idea of the China-US relationship becoming more like the Japan-US one, I think that it would take substantial changes, including a complete rethink in the Communist Party that I don’t see happening under China’s current president. It would require a massive change for the US and China to buddy up like the US and Japan have. It's just not in the cards, at least in the short to medium term.
PRISM: So painting the picture forward from a just from a global perspective, it's probably already the case that it's a world with two great powers, but is that the world that you envision for the next 10-20 years?
BE: Whenever you start jumping out 10 or 20 years into the future and try to speak with certainty, you get into a risky business. You can speak of probabilities or plausibility. So what is a plausible scenario or maybe a likely one? It’s probably a multipolar world. The US and China will be the superpowers, at least as far as I can see right now. Something could come out of left field in the next 10 to 20 years, but to just write off the European Union – a massive and influential economic bloc – or to not recognize the gradual rise of Africa – where there are many success stories that are not being covered – feels wrong.
I think Africa deserves more attention, even though I focus on Asia Pacific, and I think it will get more attention in the years to come. If current trends hold, the population of the continent is projected to double between 2020 and 2050, reaching about two-and-a-half billion people. Nigeria, which is already the most populous country, is set to double reaching around 400 million people in 2050. And it’s not just that the number of people is growing, but the economies are growing there, too. There's also great innovation and creativity on the continuent. And once you start to look at the different countries and the different parts of the continent, you start to see that it's not the mess that is often portrayed in Western media; it's not a simple story of disaster, unstable politics and corruption. There are amazing stories of entrepreneurs and such.
So getting back to your question. Is it about the US and China? Mainly. But, do not lose track of the fact that the EU – even though it has its issues like slower growth and maintaining cohesion – is not going to disappear in the next 10, 20, or 100 years, right?
One last thought, Southeast Asia – ASEAN countries – are a place to pay attention to, as well.
PRISM: Your point on Africa is super interesting. The rise of Africa is one of those narratives that I feel like has been around for quite some time, and I think it’s true, but I feel like it just has never come to fruition in the way that people have always claimed. It feels like one of those Brazilian stories where the future is always there as a potential, but it remains out of reach. So, I guess my question is: Where are we on that curve when it comes to Africa?
BE: I'd say you just have to take a longer perspective. I am not saying that Africa is going to be perfect in the next 5 to 10 years; I'm talking more 30 to 50 years. Things may go sideways, but you have more and more companies seeing opportunity there. You have growing middle classes, and people are increasingly connected to the internet. Things are only going to get better as there are things like satellite technologies that allow more people to stay connected.
And, of course, there are huge challenges on the continent, so it is not like tomorrow companies are going to start deciding whether they should open their next office in Singapore or in Nairobi. But, increasingly, Africa is going to be a part of the picture. If you take the whole continent’s economy, it's still small compared to China, but there is going to be tremendous growth – not necessarily everywhere on the continent, but big parts of it are going to see growth and the continent will increasingly be part of businesses expansion plans.
China's there in a big way, with billions of dollars of lending and investment. They are of course trying to get to the commodities and the natural resources. Geopolitically, the region is becoming more important.
And in response to your observation regarding Brazil, I think it is a longer story. Africa as a whole has a lot more than Brazil does. Brazil has stumbled so many times and it stagnates and has huge internal issues, but even with all of that, Brazil is still going to be important in South America. The case of Africa, however, is completely different. We are talking about a continent of over 50 countries, so there’s not really a way to compare them.
PRISM: In a sense we have this idea that Africa will be important in 50 years, but the precise nature of why it will be important in 50 years is not that clear. We have the broad outlines of ideas – the demographic changes, the economic growth, et cetera – but there are a lot of deals to fill in to have any sense of what the future of Africa is going to look like. I think that’s what you’re saying, right?
BE: Yes, largely speaking. I would say at this point – and to reference my book, which is on strategic foresight – one thing that is useful when looking to Africa is to practice “horizon scanning”: to monitor the weak signals and developments that may come to nothing. In this sense, I am talking about very small, micro-developments: things that you see on social media or rumors that you hear of a business planning some investment. These small indications could be signals of some major trend. In Africa, watching weak signals now – that is how companies position themselves, how economies are reforming, where good governance is emerging – are all going to help you identify longer-term trends. So paying more attention to the small things that are going on is something that I would recommend in the case of Africa.
PRISM: On the development side of things, with your decades of experience in that area, how would you explain where development as a whole and as a practice is at the moment? What are the big themes that are happening in development?
BE: Okay. Wow, how to keep this short. Looking at a very high level, I think what we will see this next decade is an increasing shift toward Africa and the Middle East. So, although I was just talking about the rise of the continuing rise of Africa – or at least parts of Africa – this is still the region of the world where the most profound development challenges exist. In the Asia Pacific region, the Asian Development Bank developed a new strategy to get us to 2030. I think they approved this in 2018 and the forecasts at the time – albeit pre-pandemic – suggested that there would only be two low-income countries left in the region by 2030. Basically, it said that it would be a region of middle- and high-income countries. Asia has the resources, the technology, the sophistication, the global links, and so on to sort itself out. There are still challenges if you are in rural Nepal or parts of Tajikistan, and you can see those remaining and there are huge challenges in some of those places. But Asia overall has the tools to sort out their issues.
Africa does not have that in the same sense. Canada in the last several years created its own development finance institution, and the US has one of these, the DFC – the Development Finance Corporation – and most other major Western European countries have these types of government-run financing institutions that provide loans and investments to the developing world. But when Canada set its DFC, they focused it on Latin America and the Caribbean – because Canada's also in the Western Hemisphere – and one other region: Africa.
So for a new institution, when they had to figure out how to allocate resources, there was basically very little attention paid to the Asia Pacific region because that’s not where the big challenges lie at this point. And it’s been seen with bilateral donors who provide grants for development; increasingly they are pulling out of the Asia Pacific region, because they see their resources being better spent elsewhere since it seems like the region is on the right track. Instead, they are relocating their resources to Africa and the Middle East, where one can operate if it's not too chaotic or unstable, as might be the case in Syria and Iraq. So that's one trend.
Technology is going to be a massive second one. And COVID-19 has been important here because it has accelerated the use of technology, including in development – for instance, with the use of drones to deliver essential items or with platforms like the one we are using right now to communicate being used to convey information and exchange knowledge.
Then there is a growing sophistication in human capital and increased capacity in developing countries. For example, when the Asian Development Bank was established in the 1960s. Asia was in a completely different place. The socio-economic indicators were very poor, and there wasn't a lot of internal capacity to address the challenges that the region’s countries faced without substantial assistance from the outside world. Now, it’s a very different story. When you go into offices in Bangkok or Jakarta or Manila and start dealing with ministers and senior officials, many of them have been educated in the West or at very good institutions in Asia, and if you’re not on top of your game, they’re seriously wondering what we have to offer. It’s a very different story than it used to be. What I am getting at is there is so much more capacity to deal with local challenges than there used to be. There’s still interest in international knowledge and not all countries have the same level of capacity, but overall, it has grown remarkably.
So you have what do we need international experts that get flown in to support with credits or guarantees or making connections to relevant markets, but the story of the international consultant flying in on behalf of the World Bank is less of a phenomenon than it used to be and that will increasingly be the case. And this is something that we have seen more of because of COVID-19.
PRISM: What do you see as the role of the US in development and more broadly on the international stage? It seems like Biden is trying to reassert that role. Do you see it as a blip in a more general retreat? Or, do you think that Biden's really going to reinvigorate the US’ engagement with the rest of the world?
BE: One could argue that the last administration was a blip as it was more skeptical of international ties and was always asking “What’s in it for us?” In that sense, Biden coming to power was a bit of a reversion to the norm. That said, populist forces in the US want the government to spend more time on domestic problems. During the times of COVID-19, there was also an intense domestic focus. For instance, Congress’s initial economic response packages were domestically focused. On alliances, Biden has tried to reassure all allies that “We're back, we are working with you, and we value you.” And, you’ve seen trust in the US go up in international surveys. So, there seems to be a sense internationally that the US is not going on its own and telling others to go off on their own. I think it comes down to what the next administration is. I don’t think it will be as extreme as the last one, but I think we will continue to see this establishment consensus that the US needs to work with other countries and international organizations. Depending on who's in the White House, that message and how strong it is may vary, but I think overall US engagement is going to stick around.
The last thing on this point is that even though Biden has certainly reached out to allies and reassured them that alliances and partnerships remain important, we aren’t seeing the money needed to make stuff happen. There are some pockets for the international community; for instance, if Build Back Better comes through, there’s some money there for investments in international support to combat climate change. But, when it comes to things like international engagement in Southeast Asia, there are a lot of platitudes and a vision for a peaceful Indo Pacific, but where’s the money to make that happen? I think there's a little bit of a disconnect. The US Development Finance Corporation that I referred to earlier, was created by the US government’s Overseas Private Investment – OPIC – under President Trump. It was picked up and moved forward by the current administration, and there are indeed resources in this government body that are supporting US companies investing in the developing world. So, there are resources there, but in the context of the global infrastructure financing gap, the resources there are relatively small, and compared to what China is investing, it’s small potatoes. The rhetoric is there, but the resources behind it aren’t.
PRISM: Super interesting. So from there, I just wanted to hit on a couple other things that haven't come up too much yet. One is COVID-19: How has it impacted the long-term, global trajectory? I think everybody talks about how it has accelerated trends with tech and with regards to China. Is that your view?
BE: The first thing in terms of acceleration – and I agree there is a lot of focus on things accelerating: scientific discovery, healthcare of technology, and other things – but what else? I think the jury is still out. If one has been following how the office has changed and the prospect of the “great resignation”, you have to kind of look at that as though it is evolving. We don’t really know where those trends are going to end up. In the next decade, it's not like everyone will be working virtually. That said, I think the era of most professional workers working a standard job that is nine-to-five in the office is probably over. That is a completely new trend, something that was not really foreseeable in February 2020. Sure, some of us had colleagues who were working virtually at startups or across different countries, but that is nothing compared to what we have seen since the start of the pandemic. But the short story is, work will be more hybrid, more virtual, and I think we are stuck with that, but it’s also not going to be one extreme or the other, where it’s either completely online or only in the office. There’s still a draw to the office. We are social beings, and there are advantages to working in close proximity to colleagues.
In the case of education – and I wrote on the future of higher education at the start of the pandemic – it's more that trends are continuing. In the US, a lot of institutions were going to go out of business and that was an idea seen by a lot of people watching the sector closely. I’m not talking about the elite institutions – the Harvards and Stanfords – but the community colleges that were already facing challenges. In the US, there is a declining school-aged population and COVID-19 made this worse. Classes on Zoom became a temporary fix to teaching, but it opened our eyes to different possibilities to fix the higher education system. Other things underscored issues in the education system, too, like the exorbitant price of a college education. That’s not really tenable. So, US higher education faces a lot of challenges, and technology will play some role in addressing the challenges, but not all places of higher education are well equipped to deal with this transition.
PRISM: What happens to these higher education institutions that go out of business? What happens when one of these goes out of business? Is it just “That’s it!” and then there are a bunch of vacant university buildings? Or is it a bailout situation? What happens there?
BE: Well, it depends on the university. There are thousands of public and private post-secondary institutions in the US. So, we're not talking about universities that are at the top of one’s mind. Some will merge with others; some will go out of business. The property might get turned into a WeWork or residential units or maybe they are just torn down. I was born in Canada but grew up in Arizona, and the Thunderbird School of International Management was in Glendale, Arizona. It built a well-known program with a good alumni network, and it was ultimately taken over by Arizona State University. I think we will see a lot of that.
The importance of the degree is also going to change – not in general, but by sector. We are already seeing this in tech. Google and others are looking at the shortage of workers and thinking “Do you really need a university degree – undergraduate or graduate – to do basic functions inside a company?” Somebody who's reasonably intelligent, has a high school diploma, and spends an intense several weeks in training can still contribute as a programmer or in some other role to a company. So the importance of the degree in some sectors is going to change. This won’t be the case for all jobs, not necessarily management, but it is going to be the case, especially as these micro-credentialing programs arise and as you see that you can get more parts of an education online for free or at a very low cost. So massive changes are happening in that space, and university degrees may not matter as much.
I mean this is relevant to my family; my son is doing his first year of computer engineering. Given my background and that of my parents, in a sense, the initial expectation was kind of “He's going to go get a master's degree,” but I have realized that may not make sense for him or his classmates. If students have an entrepreneurial interest they might quit before they finish their degree because there's more to learn and more money to be made without that finishing. That's not going to be the story for everyone, but there is a growing body of anecdotal evidence that is really making the case to rethink the need for a university degree depending on what sector you want to be in later on.
PRISM: I've definitely seen that myself. Apprenticeships are becoming a really big thing in the UK, and a lot of my friends and former colleagues have taken advantage of that. At the end of the day, you still get a degree, but you're doing a studying and working mix that is attractive to a lot of people.
BE: Another thing is the rise of the Asian universities that in the last decade have really risen in the ranks. Are foreign students going to come to the US or wherever to study when they have excellent universities at home? There’s going to at least be a lot more competition among universities than before.
PRISM: I wanted to get back to your book. I am really curious about what it was – almost at a philosophical level – that made you want to write your book. What is it about strategic foresight that people get wrong?
BE: Okay. First let me say that I am not so confident to say that I am telling them how to do it right. Instead my goal was to expose them to the field and to the idea of strategic foresight and get them to ask “How can I discover more?” and “How is this useful?”
What inspired me to write the book was all the time that I spent in Asia, since that is the direction that the world is tilting. So basically, I was in Asia from 2000 to 2017 and I’ve been connected to the region since then by connections with colleagues and what not. But for me, it was seeing the really unprecedented economic, social, technological rise in the region and seeing it happen in such a short period of time. Spending all of this time in Asia and seeing things change in real time got me thinking about the future: the future of Asia, the global future, and so much more. That was one piece.
Then there was the time for reflection that some of us had during the pandemic, and I was spending a lot of time thinking about how we come out of a crisis, particularly one that was mismanaged at so many levels. I wanted to get to the root of was: How can we do a better job of anticipating crises and opportunities in the future?
So, we have these tools in strategic foresight and they are not widely known. A study was done by the University of Houston, which has a degree program in strategic foresight, and they found that only one in four Fortune 500 companies have in-house capacity on strategic foresight. Sure, they're doing risk management and forecasting, and they might even be doing foresight types of things, but they really haven't invested in foresight, and that has been one of the trends that I have seen during COVID times: the hiring of foresight specialists or futurists – and there's an overlap there.
Ford Motors now, for example, has an in-house futurist, as an example. Governments are doing this, too. The pandemic really shook governments, since it hit them in unimaginable ways. And you saw people join the center of governments, at the Prime Minister level in Spain and Greece, to offer these insights. So this type of thinking has started to gain momentum, but what really inspired me was seeing what was happening in Asia and then the fact that these tools were not being utilized.
PRISM: That’s a great call to action as we reach the end of this conversation. It’s been quite a wide ranging conversation that we’ve had. We have talked about the overestimation of China being a massive bogeyman, Africa's rise, Asia’s rise, the idea that Europe might face challenges but that with some proper foresight those can be addressed, and many other topics. All of this sends a bit of an optimistic case for the world. Is that general where you come from?
BE: Yeah, I'd say cautiously optimistic, the glass is half full. I would say that maybe some people would call my stance wishy-washy, but view it as you will. I think any strand where you are talking about China and it is completely negative, you’re not looking at the right picture. And I think that one thing policymakers, professionals, and business leaders could spend more time doing is think about the perspective of countries in Asia; not only China, but all of Southeast Asia. So as efforts are made to build up these alliances, friendships, and partnerships, there is too often a missing understanding of where these countries are coming from and their thinking on topics. In a lot of cases, they don’t want to choose between China and the US, but there is a lot of pressure for them to be on one side. I think their views need to be understood a little bit more clearly and respected more than they have been. They want to have good relations with both countries.
PRISM: That definitely makes sense. Well, thank you for this. It has really been such a fantastic talk and it was great to cover so much ground.
BE: This has been a pleasure. It was great to engage with you. Thanks!