Author: itsupport

IMF reckoning on fallout with rogue nations

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Africa and the International Monetary Fund (IMF) have for years been strange bedfellows. In times of economic bliss, the continent often tends to deal with the IMF at an arm’s length. Yet when the tides turn and economies take severe beatings, a majority of African countries turn up at Washington DC with a bowl in their hands, begging. This offers the opportune moment for the Bretton Woods institution to demand ‘structural reforms.’ For most African governments, there is often no escape route.

Over the past two years, this has been the reality playing out in Africa. With the economies of African countries like Egypt, Kenya, Ghana, Zambia, Tunisia and Nigeria among others ravaged by debts, impacts of Covid-19 and external shocks including the Russia-Ukraine war, the continent has witnessed a forceful return of the IMF. As a tradition, the multi-lender has come bearing a basket of conditions for bailouts and other forms of financing. In effect, this has evoked the memories of the 1980s and early 1990s when structural adjustment programmes (SAPs) left a bitter taste in the mouth of African countries.

“The IMF is a firefighter. When you call the firefighter, you should not expect them to provide any meaningful help with structural problems caused by a fire,” says Ken Opalo, Associate Professor at the Georgetown University Walsh School of Foreign Service. He adds that, largely, the current relationship between African governments and the IMF is fundamentally different compared to the crises of the 1980s and 1990s. However, the common denominator between then and now is that African nations are in desperate need of finances from the IMF’s deep purses owing to prolonged economic crises.

Currently, a majority of African countries are going through a state of economic turmoil. In fact, the IMF reckons in its regional economic report released in October that, for sub-Saharan Africa, 2023 has been a difficult year. Owing to inflation, exchange rate pressures and elevated debt vulnerabilities, gross domestic product (GDP) growth is expected to fall for the second year in a row to 3.3 percent from 4 percent last year. Though a rebound is forecast next year to 4 percent, this is not guaranteed. “A slowdown in reform efforts, a rise in political instability within the region, or external downside risks could undermine growth,” states the IMF in the report.

Putting out fires
The forceful return of the IMF to put out economic fires across Africa has been in the making in recent years. In Egypt, massive borrowing by the President Abdel Fattah el-Sisi regime to fund extravagant mega projects has sunk the country into a debt abyss. External debt, according to the Central Bank of Egypt, currently stands at $157.8bn. Apart from debt, the country is also struggling with foreign exchange shortage at a time when the Russia-Ukraine war has pushed commodities and oil prices through the roof. The effect has been a local currency in a state of paralysis and skyrocketing inflation that hit 39.7 percent in August this year compared to six percent in the same month in 2021. Under the worsening economic realities, Egypt has turned to the IMF for a $3bn bailout.

This time the IMF is paying more attention to safeguarding developmental gains

The economic crisis in Egypt is similar across many other African countries. In Zambia, default on external debts amounting to $17.3bn has forced the country to beg for a $1.3bn IMF bailout. In Ghana, severe economic and financial challenges including defaulting on some of its domestic and international debts saw the country turn to the IMF for a $3bn 36-month financing arrangement. Tunisia, on its part, has negotiated for a $1.9bn bailout, while Kenya secured $1bn under its extended credit facility with the Bretton Woods institution.

Maged Mandour, a political analyst and author of the upcoming book Egypt Under El-Sisi, contends that the economic crisis in Egypt, as in most other African nations, is deep and the IMF offers a remedy, albeit with bitter conditions. “The desperate need for bailouts gives the IMF the edge in pushing for structural reforms,” he states. He adds that in the case of Egypt, the IMF cannot afford to bury its head in the sand akin to 2016 when it approved a $12bn loan but opted to ignore the deep control of the economy by the military. “Conditions on the current loan aim to force the government to demilitarise the economy,” he notes.

The fact that the IMF is determined to push reforms in troubled economies is evident. For countries seeking bailouts and emergency financing, the lender has imposed tough conditions and implementation of austerity measures. This means an end to government subsidies on commodities and fuel, increases in taxes for governments to generate more revenues to meet their debt obligations, privatisation of burdensome state companies, a cut down on unnecessary expenditure, layoffs to reduce the public wage bill, adoption of fully flexible exchange rate regimes and enhancing transparency and accountability, among others.

Safeguarding sectors
According to Opalo, unlike the SAPs of the 1980s and 1990s, the IMF has somehow changed and is today more realistic. Considering that African countries and their political and policy processes are also a lot more mature, the IMF understands that the push for structural reforms should not come at the expense of social sectors. “This time the IMF is paying more attention to safeguarding developmental gains made in education, healthcare and other social sectors,” he notes.

The desperate need for bailouts gives the IMF the edge in pushing for structural reforms

For governments, however, the pain of the conditions is unbearable. In the case of Egypt, for instance, the IMF push for an end to the military’s tight control of the economy, a situation that has suffocated the private sector, is causing discomfort. The government is preparing 32 state companies for privatisation, the majority of which are under the control of the military, and has even signed deals worth $1.9bn, but President El-Sisi knows that his continued hold on power is entangled with keeping the military happy. Though the regime has reluctantly agreed to privatise state entities, it is bluntly refusing to implement the condition of further devaluation of the Egyptian pound, not before presidential elections slated for December.

“Egypt is not ready for a radical departure from the current configuration,” avers Mandour. This, to a large extent, explains why the IMF is withholding disbursements agreed under the $3bn bailout. Disbursements under the 46-month programme that was signed in December 2022 are subject to eight reviews. The first was originally scheduled for March but is yet to happen owing to the fact that the IMF is unhappy with the country’s progress in fulfilling the terms of the agreement.

Unbearable terms
Egypt is not the only African nation that is edgy with the IMF conditions. In Tunisia, President Kais Saied has rejected what he termed as ‘diktats’ for the $1.9bn loan package agreed in October 2022.

Despite reeling in a deep debt hole amounting to $36.2bn, which is 77 percent of GDP, Tunisia wants the IMF to review the conditions of the loan. For the country, abolishing food and energy subsidies and making layoffs to cut the public wage bill are bound to instigate unrest. Notably, Tunisia has been bold in standing up to the IMF owing to its unique location that enabled it to reach a financing pact with the European Union aimed at stemming irregular migrations. The country has already secured $135m under the pact. “Tunisia is basically blackmailing the EU to get funds to stop migrants,” says Mandour.

But not all countries are playing hard ball. Kenya, Nigeria, Zambia, Angola and The Gambia are among countries that are adhering to the IMF conditions. Kenya, for instance, stands out. The East Africa nation has faithfully implemented IMF conditions for its $1bn financing package. These include abolishing food and fuel subsidies, doubling of value added tax on petroleum products from eight percent to 16 percent and embarking on restructuring of troubled state corporations, among others. Some of the reforms, which have earned Kenya rare praise from the IMF, have ignited protests due to skyrocketing costs of living. “We commend you for what you are doing on your fiscal measures. The country is certainly headed in the right direction,” said Kristalina Georgieva, IMF Managing Director during a visit to Kenya in May.

The love-hate relationship between the IMF and African nations has become one of the critical drivers for the clamour for widespread reforms of the global financial architecture. The continent has been vocal on the fact that the international financial system is overwhelmingly based on a creditor-centred model. In essence, the model often locks out African countries from fair, concessional borrowing. In addition, Africa contends that the system restricts access to affordable capital and is also characterised by ‘conditional’ lending. For the continent, reforms would not only open doors for debt relief but will also unleash floodgates of financing. Currently, Africa’s public debt stock stands at a staggering $1.8trn.

“African governments must manage their finances better even as they push for debt relief and more reasonable evaluations from credit rating agencies to lower their cost of borrowing,” notes Opalo. Failure to adopt prudent management of public resources means the cycle of economic crises is bound to continue. For this reason, the IMF will always be on hand with its bitter pill of structural reforms.

The looming pensions dilemma

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Angry Parisians, heaps of uncollected rubbish, clashes with the police. While being a traditional French pastime, demonstrations also carry a symbolic meaning, capturing the zeitgeist of the time. If the May 1968 riots were the product of a bored youth, this spring’s protests over pension reform convey another message that reverberates beyond France: the coming pension crisis. The protests were sparked by the rise of the pension age from 62 to 64, bringing France in line with the European average. The reason, the French government argued, was that the system would collapse if the status quo remained intact.

Anger over the delay of a well-deserved right after decades of toil is rippling across the globe. Pensions are becoming a hot-button issue for governments, not just because they are important for older voters, but also because their allocation is underscored by deeply-held beliefs in social justice and intergenerational solidarity.

Under pressure
Pension systems face a crisis due to a combination of demographic trends, economic conditions and government policies. Populations in developed countries are ageing fast, with rising numbers of retirees putting pressure on pension systems. By 2050, the ratio of pensioners to working-age citizens in the developed world is expected to rise to 1:2 from the current 1:3 (see Fig 1). The pandemic accelerated this trend by pushing older workers to retire. Pension systems in eight of the world’s largest economies will face a staggering shortfall of $400trn by 2050, estimates the World Economic Forum.

Governments have sought to alleviate these pressures, but reforms are at best half-baked solutions and often create new problems. Systems have generally shifted from defined benefit (DB) pension plans, where retirees receive fixed benefits, to defined contribution (DC) plans that tie benefits to contributions. This places responsibility on workers to manage their retirement savings, which increases risks for those lacking financial literacy. Many are not saving enough, creating a vicious cycle that can strain pension system sustainability.

Policymakers hope that pension funds can fill funding gaps through smart investment, but their performance has been marred by market instability. Fifteen years of low interest rates pushed pension funds to turn to risky alternative assets that offer higher returns. Last year, Ontario Teachers’ Pension Plan, one of Canada’s largest funds, was forced to write down the $95m it had invested in FTX, a crypto exchange that went bust. The recent surge in interest rates has improved funding levels, enabling funds to earn hefty returns on bonds. Pension plans controlled by the UK’s Pension Protection Fund reported a surplus of £431bn last spring, compared to a £132bn deficit in 2020. However, higher interest rates have also exposed vulnerabilities in little-known corners of the financial world, such as ‘liability-driven investment,’ a derivative investment strategy used by UK pension funds that sparked a crisis in the government bond market in September 2022.

While policymakers have known for decades that reforms are necessary, progress has been slow. France may be an outlier among its European peers for raising the retirement age too late, but nearly half of OECD members face similar problems; Parisian riots demonstrate why such policies can be politically explosive. The UK government has delayed plans to raise the state pension age, fearing reactions from older voters. Pension reform can also cause generational conflicts, with younger workers fearing that pension systems operate as Ponzi schemes that may collapse before they retire. In the UK, the system’s sustainability is undermined by the ‘triple lock’ rule, which ensures that the state pension increases annually by the highest of price inflation, earnings growth or 2.5 percent; a report by the Institute for Fiscal Studies found that the rule has increased annual pension spending by £11bn. “The UK state pension is relatively poor compared to many other countries, so something needs to be done about that,” says Iain Clacher, an expert on pensions at Leeds University Business School, adding: “Longer-term, much more generous limits on private sector accumulation will have to be the solution. With much noise made about annual and lifetime allowances, this will ultimately cap the pension that accrues, and so the state pension will always be a bigger component of someone’s overall retirement income.”

While policymakers have known for decades that reforms are necessary, progress has been slow

Across the Atlantic, many US pension funds struggle to provide retirement benefits, with state pension debt reaching $1.3trn. Last spring, legislators from Illinois and New Jersey requested a federal bailout of their states’ public pension systems. A 2022 study by the insurance company Milliman found that among the country’s 100 biggest public pension plans, one in four were below the 60 percent funding threshold. Critics point out that pension administrators eagerly spend profits from good years, while making over-optimistic economic assumptions about future returns. Although most public retirement systems are not in immediate danger of insolvency, “many need some notable improvements to ensure they aren’t vulnerable to economic downturns or investment risks,” says Jon Moody, Vice President of Research at the Equable Institute, a US think-tank that studies retirement policies, adding: “If there is a sustainability crisis, it will be related to how costs influence decisions related to future benefit values or government programme cuts.”

Others, like Teresa Ghilarducci, a retirement expert at the New School for Social Research, call for a shift to a government-backed social safety net for pensioners. “There is a US retirement crisis, but no pension crisis. The public employees’ pension funds are not the problem, in fact they are part of the reason the crisis is not worse,” says Ghilarducci. “The crisis is nearly half of middle class workers going into retirement without a pension and only the basic Social Security benefit. Millions more elders will be poor in the next 10 years.”

Risky business
Aiming to raise funding levels, governments push pension funds to adopt riskier investment strategies that could contribute to capital formation and economic development. The UK Chancellor Jeremy Hunt has set out a plan encouraging defined contribution pension plans to invest five percent of their assets in private equity, venture capital and start-ups. The government believes this could boost investment in high-growth companies by £50bn by 2030, while expecting the typical pension to increase by over £1,000 annually. Some experts, however, have raised concerns over transition costs and liquidity. “The types of investments the reforms focus on are by their nature illiquid, whereas DC members can switch their asset allocation just by logging into their provider and changing their fund,” says Clacher.

Critics have also pointed out that the reform fails to push funds to support UK companies. Currently, DC pension funds invest just 0.5 percent of their assets in unlisted UK companies. UK pension and insurance funds reduced their holdings of UK-listed companies to four percent last year from around 50 percent in 2000, while fixed-income holdings grew to 72 percent. If invested in the UK, pension fund assets could increase productivity and wages and eventually generate additional pension contributions, says David Blake, an expert on pensions teaching at City, University of London: “This could have given the UK the highest productivity rates in Europe. Instead, over the last 25 years, pension contributions have been invested in international equities and bonds which have done nothing to improve UK productive investment and productivity. The reforms are an attempt to change this, but they are in danger of being too little too late.” Others point out that investment should be diverted toward firms active in high-growth areas and tackling global challenges, such as climate change. “It’s imperative that the Chancellor allows pension funds to invest only in venture capital (VC) firms that are committed to mitigating the associated risks,” says Thea Messel, co-founder of Unconventional Ventures, a VC firm, adding that investment in start-ups that develop solutions to long-term issues, such as global warming, health and transport, will help pension funds yield steadily high returns over longer periods.

One of the plan’s goals is to build economies of scale by consolidating smaller funds. However, long-term investment has to come from smaller DC schemes, given that private DB schemes are closed to new members and are gradually being offloaded to insurers. “Unless there is a plan to consolidate these schemes, it will be difficult to achieve the scale needed to invest in the big infrastructure investments the government wants to see,” Blake says.

The perils of investing in risky assets became clear in 2021 when the Pennsylvania teachers’ pension fund discovered chronic misreporting of its investment returns, resulting in higher member contributions to fill the gap. The scheme’s funding levels had dropped to just 60 percent due to rising pension benefits and a costly investment programme that included underperforming private equity and high-risk holdings such as loans financing Iraqi oil fields. Another problem is the lack of transparency, as private equity managers often guard their activities as ‘trade secrets.’ In some cases, crucial details are not shared with pension fund officials, many of whom lack financial training, while private equity valuations are often inflated by managers. “The opaqueness around how private equities are valued can contribute to the growth of unfunded liabilities,” says Moody from the Equable Institute, adding: “In cases where they are over-valued, required contribution rates can be set too low, which would result in unfunded liabilities purely because of an error in how the assets are valued.”

Performance is also questionable, despite the hefty fees involved; a 2021 JP Morgan study found that private equity only marginally outperforms stocks. Cases of over-reliance on private equity returns in the US can serve as a cautionary tale for UK pension funds whose previous dalliance with private equity was hampered by similar problems, according to Blake: “Unless the issues of poor transparency, high charges and the difficulties in accessing the true performance of private equity firms are resolved, there is likely to be a repeat of what happened 30 years ago.”

Power and profits: welcome to the mafia

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Hailing from Aspromonte, a mountainous region in Southern Italy, Anna Sergi has first-hand experience of the mafia’s devilish appeal. Her latest book Chasing the Mafia is an idiosyncratic travelogue that combines memoir, sociological analysis and investigative journalism. Through anecdotes, personal memories and records of criminal cases, the University of Essex criminologist dissects the inner workings of the most powerful of Italian mafias, the Calabrian ‘ndrangheta, explaining how it spread its tentacles around the world, often with the complicity of banks. From the pristine beaches of Australia to Canada’s snow-covered prairies, Sergi follows the traces of a versatile organisation that is decentralised, globalised and innovative, just like a modern business. Beating it, she explained to World Finance’s Alex Katsomitros, will take a bit more than heavy-handed policing and money thrown at the problem.

What is the ‘ndrangheta?
It started as a brotherhood of so-called ‘honourable men’ that appeared after Italian unification in 1861. Fast forward 100 years and you find an organisation well established in the small villages and cities of southern Calabria, a region suffering from the perception that southern Italy is different. During the ‘Mafia Wars’ in the 1960s and 1970s, the clans needed money, because Calabria was poor. Younger generations started the so-called ‘kidnapping season,’ kidnapping around 160–200 people until the government made it legally difficult to pay ransom. They made a lot of money that was later reinvested, notably in cocaine.

How did they overtake Cosa Nostra?
In the 1970s and 1980s, the Sicilian Cosa Nostra was involved in a bloody war, won by the Corleonesi clan. They were headed by Toto Riina, a psychopath. Sicily was in a state of war, with killings in broad daylight. This was the peak of Cosa Nostra’s power, but also its demise. In 1992, it decided to attack the state, killing judges Falcone and Borsellino and planting bombs in northern Italy. The same year the port of Gioia Tauro was opened where the ‘ndrangheta invested money from kidnappings, moving into the profitable drug trade. The Italian state was going through its own crisis. A corruption scandal erupted that shook the political system. So the state was weak and its few resources were focused on Sicily. Calabria remained in the shadows until 2008 when we had the first ‘ndrangheta report. By then, it had dominated the cocaine trade.

Did its decentralised nature contribute to its success?
Absolutely. Cosa Nostra failed because it centralised everything in the hands of a psychopath. It has a top-down structure where the boss-of-bosses decides everything. The ‘ndrangheta is the opposite. Clans are autonomous. They don’t have to agree on a strategy – that happens only on a need-to-know basis. Coordination structures are not hierarchical, they are about recognising who has more power. Those who do, sometimes come together to solve problems.

Everyone is laundering money through the City, not just Russians.

How do they launder money?
It’s rarely laundered in Calabria, because the authorities are well-versed in discovering that activity. Laundering usually happens in northern Italy or Europe. ‘ndrangheta clans invest in small, cash-intensive businesses like restaurants. Sometimes you see bigger investments through puppet intermediaries that participate in consortia bidding for EU funds.

Is there collusion with banks?
Usually the ‘ndrangheta launders drug money through third-party brokers, other criminal groups that operate as intermediaries: Chinese for Europe and Pakistani or Indonesian for Australia. The second layer of money laundering involves direct engagement with banks; in Europe, Switzerland, the UK, Belgium and any country that allows ‘smurfing’: holding small sums in individual accounts without asking many questions. So European banks are complicit.

When the war in Ukraine started, the City was criticised for laundering Russian money. Is the ‘Italian connection’ big too?
Everyone is laundering money through the City, not just Russians. Why wouldn’t they? It’s easy. There are two types of UK-based financial intermediaries. Individual brokers, usually Italian, who make fake investments or launder money through the legitimate financial system. Alternatively, you have investment in shops or real estate. In one recent case, a clan was laundering money by selling non-existent flats in Calabria to British clients through a London law firm. Usually these deals get discovered when brokers get in trouble for something else.

Have they also started offering their own banking services?
Some clans do, especially clans from the city of Reggio Calabria where they are particularly financially savvy. There is a shift from drugs to more sophisticated activities like banking fraud. They provide fake financial services as loan sharks.

Does the ‘ndrangheta tap into the increasing complexity of the financial system to hide money through its army of financiers, lawyers and accountants?
Absolutely. They have these types of professionals within clans. It’s unbelievable how many lawyers some families have. They have fewer accountants, but sometimes some financial services and tax advisors. They also bribe people, but that’s riskier.

Do governments condone this sort of financial crime?
You can’t control every single transaction. You either have financial efficiency or complete safety. There is a utopia of safety whereby we assume that everything is safe. But in reality there is a threshold of tolerability where certain things are allowed until they become too problematic. In Australia, Italy and Germany, things are getting problematic, because they are expanding into other activities, like manipulation of elections. There is cocaine, but also investment in the legal economy. So what’s the priority? Is it to stop dirty money from entering the financial system? Or catch it after a company has been set up? Usually it’s the second.

Raymond Baker, an authority on financial crime, recently told World Finance that US authorities should try to stop drug money laundering, rather than just trafficking. Would that work with the ‘ndrangheta?
The point of drug trafficking is to make cash. Mafiosi don’t want to live an illegal life. They launder money in ways that evolve into semi-legal activities. Some clans don’t even want to be mafia groups forever. So it should be a priority. But you can’t even stop half of large-scale money laundering. Banks don’t want to do more checks, their clients wouldn’t like it. Do we want more efficient or safer finance? Efficiency always wins.

You mention in the book that the Mafia delegitimises the state’s authority. Does it tap into localism, especially Southern Italian separatism?
Italian mafias have exploited separatist movements, particularly a sentiment that order can only derive from local rather than national authority. But there is no ideology, no will to substitute the state or create an alternative one. They just take advantage of its weaknesses. For Calabrians, the state has many, many faces. It’s not always reliable. Its anti-mafia procedures are often contradictory. The mafia exploits this ambivalence to convince people that they should trust them rather than the state.

So what can governments do? Is economic development the solution?
Economic development alone won’t solve the problem. Mafias are parasites, the more you give them to steal, the more they will steal. What you can do is create economic wealth that translates into social wealth. One problem the mafia faces is recruitment. It’s a matter of alternatives for people. Some NGOs provide alternative paths and that’s disrupting for mafia families. However, employment and education are poor in Calabria. People distrust the government and try to find shortcuts. When those shortcuts become organised, you have mafias. Italy will receive EU funds for post-Covid recovery that could go into ‘levelling up,’ but until we level up education and employment expectations, not much will change. You can’t just send money there and hope that it will solve the problem.

Is the current Italian government doing enough to tackle the problem?
No. Meloni leads a populist far-right movement that is very anti-South. Everything she’s proposing is undermining anti-mafia investigations. They are passing legislation that limits the types of surveillance and financial investigations prosecutors can do. She supports those who believe that there is something wrong with the South, alienating people. Her government makes the mistake that many other politicians made: considering the mafia a cancer that needs to be extirpated, instead of understanding its roots within society. No Italian government has done anything serious against the mafia for at least 15 years.

Will the digitalisation of the economy weaken the ‘ndrangheta?
As Falcone said, the mafia is a human phenomenon that has a beginning and an end. We just don’t know when that end is. Mafias adjust to economic changes. Currently within the ‘ndrangheta there is a tendency to evolve into semi-legal service providers. Today, most ‘ndrangheta families are indistinguishable from other family businesses. What distinguishes organised crime is that it’s not just about profit. It’s about power, control of territory. If you weaken their power, their profit-making capacity will suffer. But I don’t think I will see that in my lifetime.

You are from Calabria. Have you ever felt threatened because of your job?
I have never felt threatened. I have felt being observed, but I know the difference between being observed because of curiosity and as a threat, because my father, a journalist, had received threats. I have felt intimidated in Australia. If you are embedded in the territory, your family is there and you are perceived as a troublemaker, then intimidation will be about people around you and coming from people around you. I don’t think I create problems because I talk about the mafia. They are used to that. I might be perceived as a troublemaker abroad, because I raise public awareness, for example by participating as an expert witness in trials in Australia or Germany. As a Calabrian, I recognise intimidation. But I hope they are too smart to target me.

The difficult art of rebranding

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In today’s world of rapidly evolving consumer preferences, businesses typically rebrand every seven to 10 years, although this isn’t always necessary if your branding is strong. At the beginning of October, we saw British financial institution Nationwide undergo its biggest identity overhaul since 1987.

Not all rebrands will be successful, which is why thorough research, planning and understanding of the brand’s audience is essential. In the past year, one of the most noteworthy business rebrands was Elon Musk’s decision to transform Twitter into X, which was met with a wave of criticism. With the backlash Musk and Twitter faced, it begs the question, what is the best way of going about a rebrand? Why does branding matter?

Good branding helps you stand out from the competition, builds an emotional connection with the target audience and creates a consistent brand experience. The success of a business ultimately depends on the quality of its products or services and the effectiveness of its marketing. However, choosing a great business name helps brands gain the recognition needed to succeed.

Six appeal
Rebranding can be a great way to refresh your brand, reposition yourself in the market, or address negative perceptions. However, it’s important to do it right. If you rebrand at the wrong moment or make changes that don’t align with your audience, you can alienate your customers and damage your brand reputation. Here are six things that businesses looking to rebrand should consider.

Thorough research, planning and understanding of the brand’s audience is essential

Background research: In the initial phase of crafting, or re-crafting, a brand identity, research and understanding are vital. This phase includes all of the research you conduct before generating ideas and includes defining and researching your target audience, your competitors and the market. Lean on resources like Google Search, Product Hunt and the Fortune 500 list for name inspiration, and tools like Google Trends and Trend Hunter for more advanced research into brand names and current trends.

Generating ideas: Finding inspiration can be challenging but there are plenty of useful tools available. Businesses may utilise a business name generator or online tools like dictionaries or thesauruses to generate new name ideas. Explore all possibilities and avoid narrow thinking. It’s okay to have a few name ideas in mind before you start, but don’t get stuck on a single idea early on. This can prevent you from exploring other options that may end up being better matches in the long run. Write everything down and shortlist later on. Explore all possible synonyms and related terms to come up with as many ideas as you can. Remember success will be gauged by how well it relates to your market, not you personally.

Brainstorming a list of names: Compile all your ideas and inspirations in one central place for ease of viewing, then, begin the brainstorm. Guidelines such as aiming for 50 name ideas or suggesting names with no more than five syllables can help you discover more usable names. Avoid special characters and word alternatives, such as replacing words with numbers or using common endings like ‘R’ us. Generic brand names should also be avoided as they can be difficult to recall. Keep your brand name ideas flexible. Consider Amazon; their transition from an online bookstore to the broad retailer they are today would have been impossible had they included the word ‘books’ in their name. Owning a single, generic word, like Apple, is also challenging and requires time to establish, trademark, and secure the domain name. Avoid this option unless you have a large budget for domain acquisitions and marketing.

Auditing ideas: A business name should be evaluated holistically, as even seemingly minor flaws can damage a brand. To effectively gauge a name’s suitability, consider the name’s language and cultural connotations to ensure it won’t be misinterpreted. Say it out loud and get an understanding of what it sounds like. Are there any potential mispronunciations? Finally, is it memorable? This can be one of the most important points for ensuring the name resonates with your target audience and sticks in their minds.

Final ideas: At this stage, you should have a shortlist. There are just a few remaining things to check before you make things official. It’s important to check that there are no legal or trademark conflicts, that there is availability in terms of social media, domain names (both local and international) and mobile app name. It is useful to have some good taglines that will work with your brand name. You should also use this time to compare any positives and negatives from the audit between names.

Feedback: Responses comes from a place of personal preference so it should not form the basis of the ultimate decision, but it often brings up valid points that may have been missed, despite the rigorous methods outlined above. Finally, this stage encourages a well-informed decision that isn’t swayed by personal preferences. This should help you decide on the overall name that best fits your brand going forward.

Clearing the air over transition finance

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The journey to net zero is proving a hard one. The fine words and ambitious targets of COP conferences are not easy to turn into reality and the changes in government policy, especially in the UK, are making that journey even tougher for many businesses and their investors. Finance is central to meeting this challenge but the major institutional investors have at times looked uncomfortable as they try to match fine statements about helping the world tackle climate change with coherent and consistent investment strategies.

At the heart of this struggle is the concept of transition finance. The words might appear to carry an obvious meaning – using investment funds to support the transition from a fossil fuel dependent, carbon intensive world to a net zero carbon world. If only it was that easy. Defining transition finance has proved far from simple as there are a host of terms and alternative definitions swirling around the whole area of what is loosely referred to as green finance: sustainable finance, climate finance, green finance, impact investments, socially responsible investing all compete for attention, leading to a lack of clarity and making institutional investors an easy target for climate change campaigners, especially those aggressively targeting the big fossil fuel industries centred on coal, oil and gas.

For some institutions the response has been to focus a proportion of new investment into obviously green projects, such as renewable energy. That still leaves them with the challenge of what to do with their massive investments in fossil fuels: that is where transition finance comes in. It is focused on supporting those businesses in their transition journeys.

Carbon cynics
There is, however, a deep cynicism about how carbon-intensive businesses are using money earmarked to support their transition to a greener world. How do investors know that they are not merely replacing money that would have been earmarked for transition projects and are instead diverting it back into fossil fuel projects using the luxury of the new investment for the transition?

Having a transition plan is a great start, but it’s only half the battle

Peter Bosshard, Global Co-ordinator of the Insure Our Future campaign, sums up the doubts about the enthusiasm of the fossil fuel sector to wholeheartedly embrace the transition to a net zero world: “Looking at the fossil fuel industry over the past few decades I don’t think it is impossible for coal, gas and oil industries to transition but we don’t see the will to do it.” He points to the intense lobbying of US federal and state regulators by the fossil fuel giants as an indication of where their priorities lie: “I think we have to accept that they are not engaged in the transition to green energy.”

There are reasons to be more optimistic, says Russ Bowdrey, Executive Director, Climate Research at MSCI Inc, and he says institutional investors have a crucial part to play in turning pledges into reality: “Having a transition plan is a great start, but it’s only half the battle. For change to manifest itself, the plan needs to be followed through and turned into reality. This is where incentives will be key. Executives and decision makers need to be incentivised to make the transition work,” he said.

Bowdrey continued: “At the same time the picture is more nuanced. Institutional investors and underwriters have a role to play in increasing pressure on corporates to ‘do the right thing’ through aligned incentives. What is becoming clearer is that there is a straightforward risk appetite angle to these too which providers of capital and insurance need to approach with eyes wide open.”

The challenge of bringing clarity to this confused debate is vexing practitioners and academics alike. The Centre for Climate Finance and Investment at the Imperial College Business School has tried to pick a way through, defining green finance as “sources of funding to new capital and operating expenditures that generate measurable progress towards the achievement of a well-recognised environmental goal.” Its analysis of the various terms and definitions led the Business School to offer a succinct definition of transition finance: “Transition finance is capital provided to economic agents to achieve a minimum rate of carbon emissions reduction.” This still leaves open the related questions of what might be an acceptable minimum rate of carbon emissions reduction and how you measure the impact of investment in it.

Things are heating up
The first question is the source of intense debate as the impacts of global warming are felt in dramatically changing weather patterns around the world. The ambitious targets that flowed from an agreement to limit global warming to a 1.5 degrees Celsius increase over pre-industrial norms that 196 countries signed up to at COP21 (Conference of the Parties) in Paris in 2015 are coming under increasing pressure. The debate over what that means in terms of achieving net zero carbon emissions and, crucially by when, rages on and will be played out again at future COP meetings. The most widely accepted target date for achieving net zero emissions to meet the 1.5 degrees Celsius commitment is 2050 and that is largely what financial institutions are focused on. Climate change campaigners are pressing for a more ambitious timetable. While that is a wider debate that will set the parameters for the finance sector, the issue of measurability and providing a practical framework for transition finance has moved centre stage.

The Glasgow Financial Alliance for Net Zero (GFANZ) launched, as its name suggests, in Glasgow for COP26 in 2021, has recently initiated a consultation aimed at giving additional substance to a four-point strategy for transition finance it announced last year. Within an overall objective of developing and scaling of climate solutions, this encouraged investors to support the climate transition by allocating capital to solutions, companies and assets aligned with the 1.5 degrees Celsius pathway, or companies and assets with a serious commitment to transition. It also said they could invest in the timely phasing out of highly polluting assets such as coal mines and coal-dependent energy producers.

Now, GFANZ wants to refine those definitions and support financial institutions to forecast the impact of these strategies on reducing emissions with some practical tools. Mark Carney, former Governor of the Bank of England and now GFANZ Co-Chair and UN Special Envoy on Climate Action and Finance, set out the ambition behind GFANZ’s latest proposals: “To achieve the largest and most rapid reduction in emissions possible, transition finance must be mobilised – urgently and at scale.

Trillions of dollars are required to bring emissions down and private finance will need to play a central role. We need to be able to track impact by measuring the expected decarbonisation contribution of financing. This consultation links decarbonisation contribution methodologies to the GFANZ financing strategies as a proposed approach to measuring the impact of transition finance over time.”

GFANZ is gathering market feedback, with the expectation that it will be able to influence the debate at COP28 and beyond. It is working on a principles-based approach to segment portfolios by the four key elements of its earlier strategy, backed with greater transparency.

To provide further clarity around transition finance, it is also addressing the issue of measurability of the impact of transition finance through a concept called Expected Emissions Reductions (EER), which it says will allow financial institutions to quantify the ‘emissions return’ of their transition finance activities more effectively.

This has not immediately impressed those looking for the finance sector and its regulators to bring greater confidence to measuring the impact of their investments: “There is a fundamental problem with EER approach in that it is based on an unknowable counter-factual baseline, crucially what is business as usual over the coming decades”, says Paddy McCully, Senior Analyst of Energy Transition at California-based Reclaim Finance.

“Of course lots of educated guesses can be made about this but a counter factual is, and always will be, impossible to know. And because of this there will always be a tendency for BAU projections to assume high emissions, so that the financial institutions can show that their interventions will produce a large gap between business as usual and what actually happens, and so generate lots of EERs,” McCully continued.

There is also fresh, if stuttering, pressure coming from the European Commission, which has issued its own proposals on transition finance, including its own definition: the “financing of climate and environmental improvements to transition to a sustainable economy, at a pace that is compatible with the climate and environmental objectives of the EU.” The Commission’s recommendation clarifies how EU firms can voluntarily use the existing regulatory framework as a means for facilitating transition finance but stopped short of recommending any new rules. These will have to wait until after the European Parliament elections in June 2024 and the arrival of a new Commission next November.

Taking the temperature
In the meantime, institutions will be looking to position portfolios in the expectation of some of these new rules becoming reality in the next few years. Many have turned to the bond markets, where an estimated $2trn has been raised since the European Investment Bank issued the first Climate Awareness Bond in 2007, according to Deloitte. Although green bonds are an important funding source for renewable energy projects, they currently represent less than three percent of global bond market issuances. Within that, bonds focused on transition finance are an almost negligible proportion (see Fig 1). This is where the sort of initiatives being driven by GFANZ come in. It acknowledges there is a huge challenge in unlocking the scale of finance required to achieve significant decarbonisation of the real economy – both through funding clean energy and helping existing businesses genuinely committed to the transition.

Creating consistent definitions that are applicable across markets and sectors will help to scale transition finance to ensure real economy decarbonisation, help financial institutions independently identify their risk exposure and the investment opportunity ahead. They can also serve as safeguards to verify that the reduction of emissions in their portfolios corresponds to actual emissions reductions in the real world, rather than being achieved solely through divestment from high-emitting assets. More money, with greater clarity and measurable impact that can win the trust of investors, governments and climate change pressure groups, is what the world will be watching for as institutional investors are pushed more and more into the net zero spotlight with the scrutiny that brings.

Dubai’s plan for economic growth

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Astute observers will have noticed that the Dubai Financial Markets General Index in the UAE is up almost 30 percent in the past 12 months, with volumes rising by nearly a quarter. For comparison, the FTSE 100 has been effectively flat over the same period, the Dow Jones Industrial Average up only 15 percent, the CAC 40 in Paris up less than seven percent, the DE40 Index in Frankfurt also up a mere 15 percent and the JP225 in Tokyo up around 19 percent.

The boom in Dubai is being led by the property sector, where two giant Dubai-based companies, Emaar Properties, owner of the Burj Khalifa, the tallest building in the world, and its subsidiary Emaar Development have seen their shares rise more than 50 percent and more than 70 percent respectively this year. This has spilled over into other sectors such as banking, where Commercial Bank of Dubai, for example, saw its shares up 25 percent year-on-year at one point, and tourism, with shares in Air Arabia, the low-cost airline based in the next-door emirate to Dubai, Sharjah, rising 45 percent from their low a year ago.

The boost to Dubai’s stock market is good news for the current ruler, Sheikh Mohammed Al Maktoum, who also serves as prime minister of the UAE. In January this year he unveiled the ‘D33 Agenda,’ which has the ambition of doubling the emirate’s GDP by 2033, the year that will mark exactly two centuries since the emirate’s foundation.

The aims of the D33 Agenda focus on doubling the volume of Dubai’s foreign trade

The D33 Agenda focuses on growth, foreign investment, and trade, to turn Dubai over the next 10 years into a top-three international tourism and business destination, by creating a globally competitive business environment and reducing business costs. The aims of the D33 Agenda focus on doubling the volume of Dubai’s foreign trade, and turning the emirate into a top five global logistics hub and a top four global financial hub and a top three global destination for business and leisure visitors.

Other initiatives include bringing 65,000 young Emiratis into the labour market in promising sectors, and launching an initiative called ‘Sandbox Dubai,’ which will allow the testing and marketing of new products and technologies, to make Dubai a hub for incubating innovations.

Potential investors in the emirate are being wooed with policies such as zero percent income and corporation tax in Dubai’s free zones, and only five percent value-added tax. The emirate is already the largest recipient of foreign direct investment in the Middle East, and is looking for investors and partners from overseas in nine different sectors, from healthcare and pharmaceuticals to trade and logistics, and from finance to aviation – and even interplanetary exploration.

Outperforming larger rivals
Dubai is effectively promised a dynamic property sector thanks to forecast growth in the emirate’s population of 75 percent by 2040. Historically the Dubai property market has easily outperformed bigger rivals, with real estate assets generating 120 percent returns for investors in rents and capital in the 10 years since the global financial crisis of 2008, against 75 percent returns in London and 63 percent in New York.

At the same time Dubai remains one of the cheapest major cities in the world for the wealthy to make a home: in 2022 $1m would buy 105 square metres of luxury property in the emirate, against just 21 in Hong Kong, 33 in New York, 34 in London and Singapore, 44 in Shanghai, 60 in Tokyo and 70 in Berlin.

The recently passed Foreign Direct Investment Law allows foreign ownership in onshore companies up to 100 percent, depending on the industry. Administrative processes have been simplified to allow certain professional service activities to be established online by investors from nearly 120 countries.

Oxford Economics, which promotes itself as the world’s foremost independent economic advisory firm, predicted in October this year that the UAE economy would grow by 4.4 percent in 2024. The firm said growth was being driven by a number of factors, including government initiatives to support economic diversification. Scott Livermore, chief economist at Oxford Economics Middle East, said he expected continued growth in the property market and a strong recovery in travel and tourism, with Dubai surpassing pre-pandemic visitor levels by the first half of 2023. He said he expected a 40 percent increase in international visitors to the UAE this year, driven by the UAE’s National Tourism Strategy ambition to become a major global tourist destination by 2031.

Legacy systems meet cloud technology

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Amid the fast-paced evolution of technology, banks have managed to stay current with the ongoing innovations in their field. Transitioning from the era of safes and account books to leveraging data and cloud technology, banks have significantly transformed in terms of their capabilities, assets and services provided to their clients.

In light of this progression, Antony Jenkins, CEO of 10x Banking’s comments referring to banks as ‘museums of technology’ back in June were somewhat surprising. For one thing, his statement does not seem to completely capture the full extent of the digital transformation that banks have undergone despite the challenges of regulation and security concerns. Furthermore, modernising legacy financial systems that have been configured for specific use cases often requires more intricate and meticulous effort than a straightforward or cursory implementation.

If we draw comparisons between banks, especially traditional bricks-and-mortar financial establishments and the systems used by Transport for London (TfL), we can find common ground. The infrastructure of TfL, with its Victorian-era tunnels and inherited rolling stock, could be seen as a ‘transportation museum.’

However, TfL has been consistently modernising, incorporating advanced technology such as tap-in / tap-out ticketing, the development of the Elizabeth Line, and the ongoing renewal and replacement of rolling stock – all of which have helped TfL prepare for today’s commuters and travellers. Much like banks, TfL is merging old and new technology, enabling the organisation to adapt and evolve to effectively cater to the changing demands of its contemporary customers.

In the case of banks, especially those with large legacy IT systems, the question of whether all systems need a technology update is equally as complex as updating transport systems. This is due to the banking sector’s frequent changes in products and services, along with the need to comply with constantly evolving regulations. Consequently, enhancing the IT infrastructure in the banking sector is a continuous process, driven by changing needs but perhaps bolstered by a new wave of fintech that can evolve both business and customer experiences.

Nonetheless, the transformation of banks in the past decade or so has demonstrated that traditional IT systems can exist alongside state-of-the-art cloud technology, delivering sturdy and adaptable solutions for digital and mobile banking as well as data analysis.

Ready for an upgrade
Banks aiming to modernise digitally should take a measured approach, focusing on business needs, cost-efficiency, and new revenue opportunities. The primary focus of digital modernisation should be to address the business needs of the bank. This could include improving customer service, streamlining operations or enhancing security measures. While addressing these things is important, so is the fact that updating legacy systems is a costly endeavour. Banks need to ensure that works are necessary and there will be a significant return on investment when integrating new technologies into their systems. Some examples of these returns could be increased savings from more efficient processes or the ability to offer new services that generate additional revenue.

Retiring legacy systems and migrating to more modern platforms, such as the cloud, can provide numerous benefits for businesses. These benefits extend beyond simply upgrading technology; they can also lead to significant improvements in efficiency, cost savings and customer service.

However, the process of assessing and migrating thousands of systems is not a trivial task. Adopting technology for its own sake is rarely advised. It should be carefully considered and may only become strictly necessary when the cost of maintaining legacy systems outweighs the benefits of keeping them. This requires time and resources to understand the impact of outdated technology on business operations. Without this thorough evaluation, businesses risk increasing costs due to potential inefficiencies or compatibility issues that may arise during the migration process.

Moreover, a direct ‘lift-and-shift’ migration to the cloud without re-architecting or optimising the applications can result in missed opportunities. Re-architecting involves modifying the application to better suit the cloud environment, which can lead to major efficiency gains and improved customer service. Similarly, optimisations during the migration process can help businesses take full advantage of cloud-native capabilities, such as scalability and elasticity.

While retiring legacy systems and migrating to the cloud can offer substantial benefits, it’s crucial for businesses to conduct a comprehensive assessment of their existing systems and plan their migration strategy carefully. This will help them avoid potential pitfalls and ensure they fully leverage the advantages of modern cloud technology. Banks can, and will, tap into new innovations and technologies. However, digital transformation in banking needs a well-considered strategy accounting for regulations, business priorities and customer needs.

The metaphor of banks as ‘museums of technology’ tends to downplay the complexity and restrictiveness of legacy systems that banks must navigate daily. Upgrading these systems presents complications that require due consideration to overcome, and which guarantee that the final result will be appreciated.

The appeal of Hong Kong

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Around 300 global bankers arrived in Hong Kong in November, from big names including Goldman Sachs, Morgan Stanley, HSBC, Standard Chartered, Citigroup, UBS and JPMorgan Chase, for the second global financial leaders’ investment summit, a two-day conference organised by the Hong Kong Monetary Authority, the city’s de facto central bank. The purpose of the event was to allow bankers from across the globe “to feel the energy, the vibrancy and also see the opportunities here,” according to the HKMA’s chief executive, Eddie Yue.

He said: “There are still misguided perspectives overseas about what happens in Hong Kong. Some of our friends in the US and Europe ask if it is safe to walk in the streets. It is important to bring people together to see Hong Kong so they see the momentum is gradually coming back.”

Hong Kong, like mainland China, may still be facing a challenging business environment post-Covid, but there are still plenty of investment opportunities, analysts are saying. In particular, Hong Kong’s government is making huge efforts to attract ultra-high-net-worth individuals to the city, to set up operations to pursue investment, philanthropy and succession planning. Hong Kong is already home to the second-largest population of billionaires in the world, beaten only by New York. However, John Lee Ka-chiu, the city’s chief executive, has set a target of attracting 200 new family offices to Hong Kong by 2025. One advantage Hong Kong has over rivals is that it does not require family offices to move their overseas assets to the city. According to Paul Knox, managing director, senior wealth adviser at JPMorgan Private Bank Asia, “this makes it very easy for clients to relocate to Hong Kong, leaving their asset holding structure as it is at the moment without needing to readjust it. As such, the level of interest is very significant.”

Ada Ma Man-shan, partner of tax services at EY, speaking at a financial forum in the city in September, said: “We have a very friendly tax regime in Hong Kong, as single family offices in Hong Kong do not need to get a licence, while in Singapore they still need to get approval from the authorities.”

Singapore, Hong Kong’s main rival for attracting ultra-high-net-worth operators, insists family offices must invest at least 10 percent of their assets under management in listed entities or start-ups in Singapore itself. Hong Kong, however, does not require family offices to invest in local markets. In recent times, Hong Kong has seen billionaires from the US, UK, Australia, Canada and the Middle East who want to set up family offices in Hong Kong.

Global attraction
However, if family offices did want to invest in Hong Kong, there are plenty of opportunities. Last year the city set up the Office for Attracting Strategic Enterprises to attract high potential enterprises from around the globe. It is now expecting to get $3.8bn in foreign investment from 30 ‘strategic’ firms, which will create create some 10,000 jobs in the city in fields such as life sciences, biotech, fintech, data sciences and advanced manufacturing, according to Hong Kong’s Financial Secretary, Paul Chan Mo-po.

Hong Kong’s government is making HUgE efforts to attract ultra-high-net-worth individuals to the city

Speaking at the annual forum of the Hong Kong Green Finance Association in October, Chan said: “We have set sights on attracting strategic enterprises, those with cutting edge technologies, to settle here in Hong Kong so we can create a more vibrant ecosystem.”

The city – technically the Hong Kong Special Administrative Region – has a government department, Invest Hong Kong, designed to work with overseas entrepreneurs looking to set up an office. It offers support with business licences, visa applications, trademark registration, and intellectual property and trade regulations, as well as support with the basics of living and working in Hong Kong, such as setting up bank accounts, and arranging housing, healthcare and schooling. Foreign firms can participate in government-financed and subsidised research and development programmes, and the city has no prohibitions on foreign investment in any sector of the economy.

In 2021, the latest year for which figures are available, assets and wealth managed in Hong Kong totalled $4.6bn, almost two thirds of it coming from non-Hong Kong investors. Open-ended fund companies as well as onshore and offshore funds are offered a profits tax exemption to encourage them to come to the city. There are a number of organisations looking to match up potential investors with businesses looking for funds, such as the Angel Investment Network. Business angels overseas can search the Angel Investment Network Hong Kong website to find business opportunities in Hong Kong in a wide range of market sectors.

Luxury cars as investment gems

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Stocks, bonds, index funds, and real estate are the traditional instruments that are part and parcel of any good wealth management strategy. However, investments in luxury items such as art, cars, whisky and wine have emerged in recent years as alternative options for astute investors looking to diversify their investment portfolio.

In fact, over the last 10 years, the Knight Frank Luxury Investment Index (KFLII) has outperformed the FTSE 100 every single year, bar one. After all, good art never goes out of style, wine and whisky mature in both age and value, and the right cars can also generate an impressive return on investment.

The luxury cars that appear on everyone’s wish list, such as Ferrari, Porsche and Aston Martin, to name a few, are synonymous with wealth and status and beyond the sometimes flashy, ‘boy-racer’ appeal, they can represent a unique investment opportunity whose value may appreciate substantially over time and become a valuable asset.

Where to start?
The best way for anyone interested in investing in classic or luxury cars is to go to car shows and auctions to see what’s on offer and talk to owners to gain first-hand knowledge of the pros and cons of ownership. It also gives potential investors a chance to decide which cars they actually like, because it is, as Andrew Shirley, Head of Luxury Research at Knight Frank says, “an investment of passion.” Investing in a luxury car is like buying a piece of art; the first question to ask yourself is: ‘Do I like it?’

Investing in a luxury car is like buying a piece of art

Of course, once the field has been narrowed down, it’s important, as with any investment, to do due diligence and investigate the market thoroughly. Reading industry news, talking to experts and researching the numbers, including price trends and historical auction results, will all help investors make a more informed decision. Finally, before writing any cheques, it’s essential to get expert help to assess the vehicle’s condition, maintenance history and, more importantly, its authenticity, to minimise the investment risk.

How risky is it?
No investment comes with a 100 percent guarantee of profit, and while investing in a luxury car provides significantly more enjoyment than buying a run-of-the-mill stock there are still some risks involved, such as fluctuating economic conditions, political instability and changes in technology, all of which can create uncertainties which may affect demand and desirability for certain models.

Historical Automobile Group International (HAGI), an independent investment research house, created the HAGI Top Index in 2008 which tracks the overall market for ‘exceptional historic automobiles’ using similar financial analysis techniques to those used in traditional investments. The August 2023 valuation shows a 7.74 percent decrease in year-to-date price, most probably due to inflation and interest rate rises. Of course, there are always data outliers and the HAGI Lamborghini Index has defied the market and produced a 5.85 percent year-to-date increase.

One of the biggest challenges and ongoing expenses of owning a luxury or classic car is keeping it regularly serviced and maintained to retain its value and ensure optimal performance. Costs tend to be higher because it’s necessary to use specialised parts and skilled labour at marque-specific dealerships, and additional costly expenses can occur if the car obtains any damage, especially if the repairs are not fully covered by insurance.

Another challenge can arise when you come to sell, especially if you are looking to sell quickly. Luxury cars have a high price tag and appeal to a small, niche market, so finding potential, trustworthy buyers who are willing to pay a premium for a high-end vehicle can take time, which limits options and delays the selling process. Making a sale can also involve additional marketing efforts above those needed to sell a ‘normal’ car, a longer sale window, compromising on price and offering significant discounts.

There are so many cars for an investor to choose from, but here are five of the best:

Aston Martin DB5

The connection to James Bond has made the Aston Martin DB5 legendary, and even without being his preferred ride, this car is a landmark British GT. Hand-built in England from 1963 to 1965, the DB5 embodied British refinement with a 4.0L, inline-six cylinder engine and elegant fastback styling from Italian Carrozzeria Touring Superleggera. Around 1,000 DB5s were produced in total in the ’60s, ensuring their exclusivity, with a further 25 models built from 2020 as part of Aston Martin’s Continuation programme. Pristine examples now sell for over £1m at auction. In 2022, Sean Connery’s 1964 DB5 fetched £2.1m, while a No Time to Die DB5 stunt car raised nearly £3m at Christie’s charity auction to celebrate 60 years of the James Bond films.

Ferrari 250 GTO

Not all Ferraris are created equal and if you want to invest in one, the 250 GTO is the one to get your hands on as only 36 were ever produced. Originally designed in the early 1960s for FIA Group 3 GT racing, the 250 GTO’s radical aerodynamic features improved the top speed of its 3.0L V12 engine and overall stability. Its racing pedigree, beautiful aesthetics and rarity make the 250 GTO one of the most expensive cars in the world, with a private sale in 2018 fetching £52m.

Porsche 911 GT1 Strassenversion

To be able to compete in GT racing in the 1990s, manufacturers had to build a total of 25 road cars for homologation purposes. Porsche’s 911 GT1 Strassenversion featured a mid-mounted twin turbo 3.2L flat-6 engine, and with a stripped interior, carbon fibre construction and massive rear wing, it was a barely legal road rocket. Porsche produced 20 cars in 1997, and a further single car in 1998 for new FIA regulations, which instantly made them prized collector’s items, and a recent 2021 price tag for a sale in Japan was £8.5m.

Shelby Cobra

What happens when you stuff a massive Ford V8 into a tiny British roadster? You get the legendary Shelby Cobra, one of the most iconic sports cars of the 1960s. After tuning and modifying AC Bristol roadsters, Carroll Shelby’s Cobras were purpose-built for dominating road courses, like they did in the 1964 World Championship, and defined raw American power with their lightweight roadster design. Around 1,000 original Cobras were built, and thanks to their legendary status, remaining ones easily fetch over £1m at auction.

Jaguar E-Type

Based on Jaguar’s D-Type Le Mans-winning race car, the E-Type debuted to instant acclaim in 1961 and is often called the most beautiful production car ever built. Lauded as a technical marvel, its curved fastback shape, designed by aerospace engineer Malcolm Sayer, instantly made everything else look dated, while a 3.8L six-cylinder engine sent power to the rear wheels helping it reach 150 mph. The Series I cars built from 1961 to 1964 are most coveted by collectors and can cost up to £250,000.

The long-term benefits
The biggest benefit of investing in luxury cars from brands such as Ferrari, Lamborghini and Porsche is their potential to appreciate in value over time, unlike any mid-range car which is generally worth next to nothing in a couple of years once it has 100,000 miles on the clock.

Take the Ferrari Dino 246GT as an example. A savvy investor could have picked one up in 1980 for less than £9,000 (£49,000 adjusted to 2023 value) and achieved an 818 percent return (approximately) by 2018 when the Dino’s price had increased to around £330,000 (£450,000 adjusted).

Limited production runs, special editions or legacy models, especially those with racing heritage or unique designs, are highly coveted because of the finite supply, and car enthusiasts and collectors will always pay a premium for the prestige of owning these pieces of automotive history, especially if the model has low mileage and is well-preserved.

However, if an investor feels they may have missed the boat with certain models, it’s always wise to keep an eye on the newer end of the market. Cars that utilise innovative technology and have groundbreaking concepts and performance can become instant classics and future collectibles, giving investors a chance to get in early.

Another surprising long-term benefit of owning a luxury car is the opportunity to generate an additional revenue stream by renting them out for special occasions, such as weddings, photo and film shoots, and corporate events, which can help offset ongoing maintenance costs.

Luxury cars can appreciate significantly based on scarcity, collectability and enthusiast demand, with ROI often beating stocks. Iconic classics and cutting-edge contemporary supercars tend to become blue chip collectibles and some of the most sought-after cars currently are the Ferrari LaFerrari, Bugatti Chiron and Mercedes-AMG One. Proper care, maintenance and restoration helps protect collectible car investment value because authenticity is paramount. So while you don’t have to be a certified petrol-head to invest in luxury cars, it certainly helps.

Redback takes on the greenback

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It wasn’t that long ago, just 15 years, when few outside China wanted to deal in yuan. It had little weight in the global basket of currencies that are traded daily, so little that it was almost irrelevant. Few countries held yuan as a store of value. And it was mostly used in payments for goods.

But that is starting to change as China embarks on a plan designed to make the yuan – or renminbi – a genuine force in world markets that is designed in the long run to challenge the hegemony of the mighty greenback. Already some foreign currency experts refer to the renminbi as the ‘redback.’

In the latest example of the way China, in a grand plan orchestrated by President Xi Jinping, is pushing its currency into world markets, Argentina paid half of its $2.7bn debt instalment to the International Monetary Fund in yuan rather than in precious US dollars, in August. It did so by tapping a currency swap line, a common arrangement between central banks, that Argentina set up with China 15 years ago. Under a swap line the other party, in this case China, provides the equivalent in yuan of the required amount.

The yuan has a growing role in safeguarding the financial stability of developing economies

A serial defaulter over the years, Argentina is just one year into a new $44bn programme financed by the IMF. The economically beleaguered nation could hardly afford to miss a payment on what is essentially an emergency loan, and China came to the rescue.

It’s the second time that Argentina has dipped into the yuan trough via the swap line to meet its IMF obligations, the last being in June. The swap arrangement is China’s current tactic to deepen the power of its currency. In technical terms it’s an agreement established between two central banks to exchange their currencies to an agreed amount. The pact allows one country’s central bank to obtain foreign currency liquidity from the other central bank, usually to finance bilateral trade and direct investment. In the case of the China-Argentina swap line, it allows Argentine’s central bank to receive yuan from its Chinese equivalent in exchange for an equivalent amount of pesos.

China and Argentina first signed a currency swap agreement in 2009 for 70bn yuan ($10.3bn) and expanded it to 130bn yuan ($19.1bn) in 2018. The arrangement has been a lifesaver for Argentina. In January 2023 the government used it to ward off a foreign exchange crisis. And, furthering the relationship, Argentina will now start paying in yuan for Chinese imports as it runs out of dollar reserves.

Things to come
This latest stepping stone in the internationalisation of the yuan, one of several, has been hailed in China as a precursor of big things to come. Citing experts, the Communist Party-owned China Daily trumpeted in August: “The Chinese renminbi, also known as the yuan, has emerged as a safeguard of global financial stability, shielding an increasing number of developing economies from the spill over effect of drastic adjustments in US monetary policy.”

Weighing in on what is in fact a small deal in terms of the vast forex markets, senior economist Yue Yunxia described the yuan-pesos exchange as “a significant, innovative step in renminbi internationalisation.”

Argentina’s plight was painted as being worsened by the US Federal Reserve’s “aggressive interest rate hikes which intensified the Argentine peso’s depreciation and increased the country’s debt burden.” As such, argued Yunxia, it proved that the yuan has a growing role in safeguarding the financial stability of developing economies as they increasingly opt for the yuan in international settlements and financing. And another economic professor, Wang Jinbin, highlighted the rescue capabilities of the yuan. “It has provided economies suffering from a dollar shortage with an alternative option for trade settlements.”

Up to a point that’s true. Other dollar-short countries such as Brazil and Bolivia also regularly make use of the renminbi in international trade under prearranged swap lines like that of Argentina. And in defiance of international sanctions India recently paid for Russian oil in yuan.

Viewed in context
However, the global data shows that these claims must be taken with a pinch of salt. Even though 2023 has been a good year for the internationalisation of the Chinese currency, its share of global payments is still just 2.77 percent, according to global financial messaging platform SWIFT, while the dollar’s share stands at over 42 percent. As of mid-2023 the yuan trailed well behind the euro, sterling and the yen in global payments.

The yuan trailed well behind the euro, sterling and the yen in global payments

And the greenback shows few or no signs of weakness. As the US Federal Reserve pointed out in a recent paper, the dollar has sailed through recent disruptions such as Covid-19 and US sanctions against Russia that many economists expected would erode its dominance. After carefully reviewing the use of the dollar in its three major global roles – in international reserves, as a currency anchor, and in transactions, the Fed concludes: “We find that the dollar remains the dominant currency and plays an outsized international role as measured by usage in international reserves and other dimensions relative to the US share of global GDP.” In fact, by all these measures the dollar’s international usage is basically unchanged over the past five years and little-changed in 20 years.

Unfortunately for China, its ambitions for the yuan run into the overriding confidence that the world has in the greenback, particularly when measured by its weighting in official forex reserves. In short, as an anchor currency for stormy seas. “The dollar comprised 58 percent of disclosed global official foreign reserves in 2022 and far surpassed all other currencies including the euro (21 percent), Japanese yen (six percent), British pound (five percent), and the Chinese renminbi (three percent),” highlights the Fed.

Put another way, the disruptions of Covid and the war in Ukraine have only served to strengthen confidence in the dollar as an anchor currency.

There’s also a vast amount of paper banknotes held in foreign hands. Indeed the volume has actually increased over the past two decades, both on an absolute basis and as a fraction of banknotes outstanding. By the Fed’s calculations, more than $1trn in banknotes is owned outside the US. That’s about half of all US dollar banknotes on issue, and nobody seems to be in a hurry to cash them in.

Step by step
Typically patient, China has adopted a step-by-step approach to the expansion of the role of the yuan that started in mid-2009. The first move was a new scheme for the settlement of trade claims abroad, primarily through the kind of swap lines used by Argentina. That meant there was a lender of last resort in trade-based renminbi lending.

The establishment of the swap lines has proved crucial. As a 2020 Bank of England paper entitled ‘Jump starting an international currency’ explains, they began to boost usage of the currency. “An upward trend is visible from 2010 onwards with renminbi usage rising from near zero to a peak at around four percent of global payments in 2015. Since then the trend has levelled out and usage is running at just under three percent.”

A big problem for China though is that only those countries that trade heavily with China use the currency the most. Many countries still don’t use it at all. That’s one reason why China is relaxing its strict capital controls. Although it is the largest goods exporter in the world, those controls made it difficult for the currency to be used internationally.

Bit by bit, China is softening its rules. Foreign investors are now allowed to trade in yuan-denominated stocks as well as in bonds via Hong Kong and in exchange-traded funds and interest rate swaps. The last two only became possible in 2022 and 2023.

Simultaneously, notes an analysis by Nikei, “Beijing has signalled it looks to push harder to expand the yuan’s role in cross-border payments.” This is exactly what Argentina is doing in trade transactions.

In late 2023 the yuan looks to be on the rise. In the second quarter of this year it was used in 49 percent of China’s cross-border transactions, topping the dollar for the first time, according to the Nikkei analysis. The main causes are China’s continuing liberalisation of its capital markets and, in what economists call an exogenous trigger, a growing yuan-based trade with Russia that is obviously a direct and disruptive result of the Ukraine war.

This is enough for some to see the yuan becoming the vehicle for eventually undermining the dollar. Citing India’s yuan-based purchase of Russian oil, Radhika Desai, director of the geopolitical economy research group at the University of Manitoba, says it “offers further evidence of the de-dollarisation of the global economy” and a “loss of trust in the crisis-prone US financial system.”

While it will be news to most economists that the US economy is crisis-prone, particularly as it is growing strongly, there are certainly undercurrents in the global financial markets that bear watching.

However, the weight of history is against any upheaval of the dollar. As the Fed points out, the only time in the last 100 years that one currency abruptly lost its dominance was when the dollar replaced sterling in the financial chaos following the First World War, an event formalised in the Bretton Woods Agreement of 1944.

Alternative investments include liquid assets

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In the last decade, bourbon, America’s native spirit, has witnessed an unprecedented resurgence with bottles such as Pappy Van Winkle achieving cult-like status. And even expressions that were mainstays at the local liquor store just a year ago have all but vanished today. Throughout Kentucky’s bluegrass country, bourbon distilleries have been battling to keep up with this surge in global demand, largely driven by consumer appreciation for the spirit’s rich, unique flavour profile.

Historically, the distilleries’ rite of passage was a waiting game. They lovingly distilled the spirit, encased it in oak barrels, and then paused, letting time and nature work their magic. They’d wait, sometimes for decades, for the bourbon to mature and only then could they monetise this labour of love. This waiting and the resulting impact on distillery cash flow held the reins on a distillery’s ambitions and production volumes.

In an industry where aging is an essential part of the product’s value, producing more to meet demand isn’t as simple as ramping up production. It involves a delicate, years-long process for which there is no substitute. Production today will only offset demand in years to come, and it’s impossible to turn back the hands of time.

Traditionally, distilleries financed their operations through the sale of their matured bourbon. This model, though time-tested, meant they had to wait anywhere from four to 20 years for the bourbon to mature before they could monetise their product. This waiting game hindered distillery expansion to meet burgeoning demand.

A new era
Today, however, a group of finance visionaries is rewriting this narrative. They’re stepping in, offering to shoulder this wait, thereby providing an immediate lifeline of capital for the distilleries. The method is delightfully simple – they buy casks of newly distilled whiskey, which are then left to mature.

For the investors, it’s the opportunity to profit as the whiskey they own matures

This strategy is a game changer, both for the distilleries and the investors. For distilleries, it’s an instant cash injection, enabling them to boost production and meet the global thirst for their bourbon. For the investors, it’s the opportunity to profit as the whiskey they own matures and appreciates in value. Beyond the potential to generate strong returns, bourbon cask investing offers a number of additional benefits to investors.

One of those benefits is the tangible nature of bourbon casks. In a world where portfolios are filled with financial instruments that lack a physical presence, it can be reassuring to own an investment you can touch and even taste, all while it continues to improve with time. And, given that bourbon casks fall under the strict oversight of the federal government due to laws governing spirits production, investors can rest assured that a watchful eye will be kept on the storage facilities in which their investments are held.

Investing in bourbon casks also offers some powerful advantages over their bottled counterparts. The first of which is that the provenance of bourbon casks is guaranteed due to storage being maintained at a federally licensed facility through the entirety of the investment lifecycle. Whereas there have been forgeries identified among rare bourbon bottles sold on the secondary market, it would be nearly impossible for a cask to be misrepresented.

Additionally, prices of bottled bourbon are only impacted by changes in demand due to the fact that after bourbon is placed into glass the aging process stops. Since bourbon only matures while it is contained inside of the cask, investing in barrelled bourbon is the only way to purchase the asset in a manner that capitalises on the aging process of the spirit. The powerful nature of this characteristic stands in stark contrast to other tangible assets which simply remain the same, or even depreciate with age.

Cultural heritage
However, the impact of these investments transcends the financial benefits. Investors, in their pursuit of returns, find themselves guardians of a cherished tradition, custodians of a slice of American cultural heritage. Their capital doesn’t just generate profits; it sustains jobs, bolsters local economies, and ultimately fills glasses worldwide with joy.

Recognising the opportunity of whiskey casks as an asset class, Los Angeles based CaskX have risen to the forefront. The CaskX platform has led the market forward, providing a mechanism that bridges the gap between bourbon distilleries and potential investors, managing everything from procurement to storage, making this investment avenue more accessible than it’s ever been before. As the market matures additional firms will likely follow suit to further advance the industry.

Ultimately, bourbon cask investing is more than a promising financial venture. It’s a story of tradition meeting modern finance, of patience rewarding anticipation, of investors and distilleries coming together to keep the bourbon flowing. As the global palate continues to savour bourbon, these investors can’t help but raise a glass to their flavourful assets, a testament to their foresight and the rich history of bourbon.

Is economics broken?

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When Claudia Goldin won the Nobel Prize in Economics last October, many of her colleagues rejoiced. The prestigious award endows the Harvard University academic with an aura of respectability that few female economists enjoy. At the crossroads of economics, history and gender studies, her work shines a light on the unrecognised value of female labour. “She has brought women to the forefront of economic study, an area that has historically been overlooked,” says Stefania Paredes Fuentes, an economist at Warwick University studying diversity in economics education, adding; “Traditional economic models with representative agents often neglect the role of women in the economy, perpetuating a lack of recognition of gender roles in the labour market.”

One reason why Goldin’s win has been welcomed with enthusiasm is that her accomplishment is so rare. Only three women have ever won the award, all in the 21st century (see Fig 1). Goldin is the first woman to receive the award without sharing it with male colleagues. This reflects the gender gap facing economics, with fewer than one out of four tenured professors in the US being women, compared to 43 percent for other disciplines. “Stereotypical perceptions of economics as a discipline dominated by men from the upper-middle class wearing suits and talking about money persist, which, combined with the scarcity of female role models, deters young women from pursuing economics from the outset,” says Fuentes. Goldin’s recognition, she hopes, could help change that, emphasising that economics is “a discipline centred around studying our society and its people, not just money and banking.”

Rage against the models
As a science, economics has never been more widely read and discussed, occasionally even turning into a pop culture phenomenon. Economists like Thomas Piketty, author of the much-discussed and little-read Capital in the 21st Century, and Yannis Varoufakis, Greece’s former finance minister, are the high-brow equivalents of football superstars, filling amphitheatres with young students hungry for alternatives to runaway capitalism. At the same time, the discipline has never faced more uncertainty and criticism, even from within its own ranks. Following the Brexit referendum, Andy Haldane, then Chief Economist of the Bank of England, acknowledged that the profession faces a crisis, as economists are increasingly blamed for society’s ills, while failing to account for human irrationality. A 2019 YouGov survey for Bristol University found that economists were among the ‘least trusted professionals’ in the UK.

Claudia Goldin, Nobel Prize winner

One reason for the discipline’s unpopularity is its complexity. “Economists have made a point of turning economics into a closed profession with a lot of jargon. People think that economics is beyond their understanding,” says Paola Subacchi, who teaches international economics at Queen Mary University of London. Despite being a social science, economics relies on advanced mathematics to describe a complex phenomenon like the economy. A recent survey of 350 Bachelor’s degrees by the International Student Initiative for Pluralism in Economics, a group including over 100 universities worldwide, found that economics degrees were highly mathematical, with non-mathematical subjects covered by just 2.5 percent of modules, while real-world applications and history were largely ignored. “The way economics is taught in universities does not include half the tools and concepts necessary to understand economic problems. The core of economics teaching is mathematics, statistics, macroeconomics and microeconomics, meaning that there is no pluralism in terms of theories and disciplines,” says Arthur Jatteau, the University of Lille economist who led the project.

Such formalisation is a product of the discipline’s history. Economics started as a branch of philosophy, evolving into a social science in the 19th century. Even then, it was largely free of mathematics. Adam Smith’s The Wealth of Nations includes no equations. Despite its humble beginnings as a ‘moral science,’ the discipline soon adopted mathematical modelling in an effort to wear the impenetrable armour of objectivity that only ‘hard’ sciences like physics can boast of. The turn towards neoclassical approaches, which emphasise supply and demand equilibriums, enabled economists to pass their policy prescriptions as scientific analysis. “Mathiness comes from this pursuit of influence,” says George DeMartino, an economist who teaches at the University of Denver. “It sends a signal to policymakers that they don’t understand what economists do and therefore they must defer to their judgement.” Milton Friedman, the high priest of free markets, famously argued that it did not matter if models made unrealistic assumptions, as long as they accurately forecast the economy’s ups and downs. For many economists, this approach is necessary for the science to maintain its academic rigour.
“Mathematics in economics brings transparency in that it makes assumptions explicit. So the models still work in most cases,” says Jon Danielsson, an economist and co-director of the LSE’s Systemic Risk Centre.

The issue came to the fore recently due to the failure of models to predict the inflation crisis. In an astounding admission, Belgium’s central bank governor Pierre Wunsch acknowledged that the European Central Bank’s models were practically useless. “It was more or less impossible in our models to produce any inflation that would not be temporary,” Wunsch said last year, explaining that they always showed price rises falling under the bank’s two percent target. The issue had broader political repercussions, with central banks taking flak for failing to grapple with the first inflation crisis since the early 1980s. Some economists dismiss these failures as part of the forecasting game. “Inflation forecasting models are notoriously unreliable, but that does not mean other models are unreliable,” says Danielsson, adding; “It’s a complicated problem and anybody trying to solve it would be an economist, whether by training or otherwise.”

For others, however, it’s emblematic of the profession’s shortcomings. “The problem with modelling inflation is that we need to take into account many different components, including some that are not easily quantified, like expectations,” says Subacchi. “We think that people are rational, but human behaviour depends on emotions, which are not easily modelled.” The emphasis on mathematics enhances the profession’s nearly inherent elitism, argues Veronika Dolar, an economist teaching at SUNY Old Westbury. “We push this idea of profit and GDP maximisation to such an extreme that we think everything can be quantified. Sometimes we lose track of the fact that maximising GDP is just a proxy for improving wellbeing,” she says, adding: “This kind of thinking facilitates the self-selection of people who might be excellent academically, but misunderstand the big picture.”

One subfield that questions rational assumptions is behavioural economics, which deploys insights from psychology to explain economic behaviour. Despite its popularity, the field is facing criticism for the controversial data collection and analysis techniques used by many prominent behaviour economists. One of them, the Duke academic Dan Ariely, who has made his name by exploring honesty and its role in economic transactions, has come under fire for using data of dubious credibility in several studies, with other academics being unable to replicate his findings. Another behavioural economist, Francesca Gino, has been put on leave by Harvard University for falsifying results in some of her papers. “In behavioural economics there’s this notion that ‘p-hacking’ {the misuse of data analysis to present non-existing patterns as statistically significant} is not as bad as outright faking or manipulating data. In my mind, presenting what you want to see is data fabrication or manipulation,” says Lakshmi Balachandra, an economist who teaches entrepreneurship at Babson College.

Her own concerns over the methods used by another behavioural economist during her postgraduate studies had been dismissed as irrelevant. One reason for that tacit acceptance of dodgy practices, she argues, is that behavioural economists work with large datasets that can be easily manipulated to produce the desired results, while samples are often selected from specific demographic groups, such as undergraduate students.

An immoral science
While concerns over academic integrity and research reproducibility are not uncommon among other sciences, economics faces a much bigger ethical crisis. One piece missing from its models, argues George DeMartino, author of The Tragic Science: How Economists Cause Harm, is an understanding of the harm that theories can cause, as most economists believe that some collateral damage is the price to be paid for a higher good. The gap separating economists from those who cannot master its advanced mathematics results in a sense of entitlement. “There’s this profound paternalism in the profession that economists know best, and society should defer to our judgement because everybody will be better off,” DeMartino says. “If you take this approach, you find that it’s okay to deceive.” One example is the ‘Shock therapy’ imposed on post-Soviet Russia by a group of Russian and foreign economists, seeking to transform the country into a market economy. The economic argument, DeMartino suggests in his book, was a smoke screen for economists to pursue their agenda. As an antidote to such behaviour, he believes that economics teaching needs to incorporate ethics, notably what he calls ‘moral geometry’: the study of how complex economic policies could affect and potentially harm different groups.

Is economics sexist?

In an era where discrimination against disadvantaged groups is openly discussed, the question of whether economics faces a gender problem is becoming more salient. A 2020 study claimed that inherent biases in the way the discipline is taught make economics students more sexist as they progress with their studies. Some economics textbooks have been criticised for being biased against women, while more than three out of four research papers are written by male economists. Gender disparity starts early on and progresses from A-levels to university, according to Stefania Fuentes from the University of Warwick, who headed a report on the demographics of economics students in the UK. “The lack of female representation can be attributed to the unwelcoming environment women and minorities often encounter in economics,” she says, adding: “This includes documented instances of sexism within economics departments, where women are more likely to experience harassment and face a hostile environment during conferences and presentations. They are also held to higher standards in their academic work: they need to write better academic papers, and are subject to higher standards in general.”

The main problem is not the number of women studying economics, according to Paola Subacchi, but the lack of visible female economists like the Nobel laureate Claudia Goldin. “We need to have more women everywhere in economics, not just women studying women in gender-oriented economics,” she says. For her part, Balachandra from Babson believes that the profession is in for some soul-searching. “We have a white male-dominated network effect. If you’re part of this patriarchal hierarchy, your research is automatically considered better,” she says, adding: “If you’re not from a branded institution like Harvard, MIT or Stanford, your research isn’t considered as good.” Economic policymaking is also dominated by male economists. Currently, only 26 of the 190 IMF member countries have female finance ministers, while just 17 have a woman at the helm of their central bank. Such absence of diversity has broader impacts, says Fuentes: “Diversity among economists is instrumental in policymaking,” she says. “Without diversity, there is a higher risk of groupthink, which hampers thorough analyses of alternatives and consideration of consequences, ultimately hindering the quality of policy outcomes.”

Another reason why economics is becoming an anathema for the public is its sheer power. In the wake of the Great Depression and WWII, a global wave of Keynesian interventionism filled government bureaucracies and international organisations with economists. From an academic discipline, economics transformed itself into a way of governing. When neoclassical economics replaced Keynesianism as the dominant paradigm in the 1970s, a new generation of economists played a central role in market-orientated reforms such as lowering tax rates. This gave rise to what James Kwak, author of Economism: Bad Economics and the Rise of Inequality, calls ‘economism’: an ideology that posed as scientific analysis, aiming to replace post-war planning with unfettered free markets. As the discipline gradually shifted from demand to supply side approaches and monetarism, thinkers like Friedman and politicians like Ronald Reagan imposed a new economic model that emphasised deregulation and a smaller role for the state. “Many prominent economists actively promote the idea that simplistic models should be the basis for policy,” Kwak says, adding: “Economics 101 is taught everywhere in a way that encourages people to remember the simple models and forget all the caveats that come with them.”

Populist backlash
While such ideological commitment has increased the influence of economists, it has also exposed them to harsh critiques. The first shock came in 2008 when the financial crisis gripped the global economy. Mainstream economics was blamed for failing to anticipate the credit crunch and prolonging the subsequent crisis through misguided austerity policies. The backlash was severe. Some attribute the rise of populism worldwide to the failure of economists to grapple with the consequences of their actions. Such disillusionment led to a rejection of economic expertise, a sentiment famously expressed by the British politician Michael Gove in the run-up to the Brexit referendum. Asked about several dire economic forecasts about Brexit, Gove said: “I think the people in this country have had enough of experts, from organisations with acronyms, saying that they know what is best and getting it consistently wrong.” He would later clarify that he was referring to economists. Many other politicians have criticised the influence of economists; Donald Trump was notoriously distrustful of economic experts during his presidency. On the left side of the political spectrum, the rise of inequality is often blamed on economics for providing the vocabulary to defend the status quo, an antipathy some speculate transmuted into a broader distrust of experts, as evidenced by anger against public health officials during the pandemic. “Economics deceived the public about the emergence of market fundamentalism, as if we were all going to prosper,” DeMartino says. “It was never honest with the public about the fact that this experiment would have winners and losers. Those who have been harmed are now getting their revenge.”

One particular target of populism has been central bank independence. Politicians on both sides of the Atlantic have questioned the competence of central bank governors, with their failure to anticipate the inflation crisis rekindling the debate on whether elected politicians should have the final say in monetary policy. “Delegating so much decision-making power to experts is unique,” argues Johan Christensen from Leiden University, a political scientist who studies the role of experts in policymaking. “You don’t see that in other policy areas. What we see now is a rebalancing phase, with growing demands for accountability and more political say over what central banks do.”

The backlash has partly borne fruit, as the pendulum is swinging towards more market regulation. International organisations such as the IMF have acknowledged that markets are embedded in societies, rather than self-regulating institutions. Central bank monetary policy is increasingly influenced by new quantitative models, known as Heterogeneous Agent New Keynesian (HANK) models, which take into account wealth and income distribution. The prevalent sentiment among economists is a need for change, says VeroniKa Dolar from SUNY: “Even mainstream economists trained in neoclassical approaches are arguing that we can’t keep talking about free markets in the current environment, with low taxes and large corporations influencing politics. There is a shift because the world we live in has changed.” Although the neoclassical school is still dominant, its grip is getting looser, according to Christensen. “New insights make their way into policymaking institutions through graduates equipped with a more up-to-date economics education,” he says, adding: “Over time, the perspectives of these institutions change as their staff changes, but there is a lag in the process.”

New paths
Defenders of economic orthodoxy argue that, like other sciences, economics evolves by learning from its mistakes.

Often adopting interdisciplinary approaches, new subfields are refreshing the discipline with a mix of pragmatism and humility, questioning the need for perfect equilibriums in an imperfect world. Borrowing concepts from computer science and cybernetics, complexity economics studies the interaction of economic networks. Evolutionary economics explains economic transformation through the lens of continuous cultural, institutional and technological change.

Contemporary challenges such as the climate crisis are even pushing economists to question some of the profession’s most sacred principles. Perhaps the most controversial among them is ‘Degrowth,’ a school of thought suggesting that undoing economic growth is necessary to hit net zero targets. Its most radical proponents advocate for a deliberate reduction of GDP, a policy that critics argue would lead to authoritarianism and extreme poverty. “Those ideas have been around since the 1960s, but they’re starting to get traction now outside of economics because of the ecological crisis. If the degrowth movement continues to apply pressure and politicians start to adopt it, then the economics profession will start taking it seriously,” says DeMartino, citing Occupy Wall Street as an example of a political movement that changed mainstream economic thinking on inequality.

Technological change is also affecting the profession, with the big data revolution facilitating a shift toward empirical approaches. One example is experimental economics, which relies on empirical research and statistical analysis of controlled experiments and evidence-based randomised control trials to estimate policy impacts. Its most prominent advocates, Abhijit Banerjee and Esther Duflo, who won the 2019 Nobel Prize in Economics, use field experiments to study the causes of economic relationships in the developing world. Critics have raised questions over the scalability of these methods and the credibility of collected data. However, the rise of experimental approaches marks a broader shift, DeMartino says: “Among younger economists there is a move toward empiricism. Rather than deducing policy implications from a blackboard using supply and demand models, there’s a turn to data.”

A precarious future
As a child of the Enlightenment era, economics is characterised by an inherent belief in constant progress, including its own ability to perpetually enhance our understanding of the material world. Such optimism may no longer be topical in an increasingly irrational world where technological progress reigns supreme. The rise of generative AI, threatening to wipe out whole professions, poses new challenges. Economists often appear on top of the list of white-collar professionals expected to be affected by automation. Ironically, the profession’s reliance on advanced mathematics, the tool that gave it the pole position among social sciences, also makes it vulnerable to technological innovation. Tasks such as forecasting and modelling can be easily performed by bots, given the large amount of literature that can be fed to AI tools such as ChatGPT. “Fewer economists will be able to generate much more output by using AI,” DeMartino forecasts.

For the time being, economists still dominate policymaking, even expanding into areas where they had little sway until recently, such as climate policy. One example is the way the UN Sustainable Development Goals are being pursued through policies largely shaped by economists, according to Christensen. However, many think that a challenge of that scale requires more emphasis on urgent action, rather than bean counting. “Until economics recognises its limits in terms of predicting the future, we economists shouldn’t have too much influence in these areas,” says DeMartino, adding: “Economics has aspired to be the physics of the social world for over 100 years. That pretension has to be dropped.”

Leader for change

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Even at a time of unprecedented globalisation, uniting 187 countries behind a single vision is a tough ask. Yet that is exactly what the World Bank, under its new president Ajay Banga, is attempting to do. Recent years have shown that developing countries around the world face an increase in barriers to development, with the climate crisis, recovery from the Covid-19 pandemic, and an ongoing war in Europe all having far-reaching impacts.

Questions have swirled about the purpose and significance of the World Bank, which operates with the aim of eradicating poverty. However, as Banga wrote in an opinion piece for Project Syndicate soon after his appointment, “While questioning its relevance, the world is looking to the 78-year-old institution to deliver solutions at scale. To do that, the bank must adopt a new vision and mission that is worthy of our shared aspirations. In my view, the vision for the World Bank is simple: to create a world free of poverty on a liveable planet.”

While many would agree with Banga in principle, the price tag for delivering this expanded mission statement will be hefty. International development experts have said transitioning to clean energy would require financing in the trillions of dollars, not only requiring a larger World Bank but also a significant chunk of funding from the private sector.

Having been in his role heading up the World Bank for less than a year, it is still difficult to determine whether Banga can carry out the reforms needed. Many are positive, however, about his prospects. “Ajay Banga has made a terrific start as World Bank President, energising an institution which has drifted in recent years,” Vasuki Shastry, a journalist who has held senior roles at the International Monetary Fund, Standard Chartered Bank and elsewhere, told World Finance.

Yet he pointed to the urgency with which Banga will need to address the question marks surrounding the bank. “Building on the goodwill his appointment has generated, Banga needs to quickly address fundamental questions about the bank’s business model. Is it the world’s climate or the world’s development bank?” Banga believes it can be both, but to make that a reality he must convince others.

A global view
World Bank reform is at the top of the international agenda, Clemence Landers, senior policy fellow at the Centre for Global Development, told World Finance. “But the spotlight on the bank may prove to be somewhat of a poisoned chalice for Ajay Banga. Indeed, there are great – in some quarters, astronomical – expectations for what World Bank reform can deliver,” she said. At a time of such upheaval and high expectation, not everyone would be confident enough to dive in, but a look back on Banga’s career trajectory shows the development of a leader who would become a perfect fit for the World Bank.

Banga, who was born in Pune, in the Indian state of Maharashtra, in 1959, is now recognised as one of the world’s top business executives, and he began his education at Hyderabad Public School and the St Edward’s School in Shimla. He then gained a bachelor’s degree in economics from St Stephen’s college in New Delhi and an MBA from Indian Institute of Management-Ahmedabad (IIM-A), which is one of the country’s top business schools. Although in a speech for the 50th annual convocation of the IIM-A he admitted that he “had no clue” what he was going to do with his life, he had an instinct that would prove to shape his entire career: join a firm with global reach.

“That was my grand plan: get with somebody good. Get with somebody global. Do something that interested me,” he said in his speech. Banga’s drive to join a large organisation led him to Nestlé, where he began his career as a management trainee in 1981. He steadily worked his way up over 13 years before moving over to PepsiCo, where he helped to steer the launch of fast food franchises Pizza Hut and KFC in India. In 1996, Banga made a shift to the financial services industry, joining Citigroup and quickly rising through the ranks to become the business head of CitiFinancial. In 2008, he was named head of the Asia-Pacific region. By this point in his career, he had lived and worked in the US for several years, and he obtained US citizenship in 2007.

Following his long career at Citigroup, Banga was poached by Mastercard in 2009, joining as president and chief operating officer. In less than a year, he was handed the reins as CEO, and he served there for a decade. In his role at Mastercard, Banga oversaw significant growth, including a tripling of revenue and a 16-times growth in its market capitalisation. Over his tenure, he transformed the business from a payments network focused on serving banks to a technology and data services company that connected people, governments and businesses of all kinds. Throughout his time at Mastercard, Banga’s public profile grew, and he was presented with a number of lofty positions, including heading the US-India Business Council in 2012 and being appointed by former president Barack Obama as a member of the Advisory Committee for Trade Policy and Negotiations in 2015. In 2021, two years before his appointment at the World Bank, he left Mastercard for global growth equity firm General Atlantic, where he was vice chairman, advising on strategic matters for the firm’s portfolio of more than 165 companies around the world.

Banga believes that to be a successful leader, one must develop a global focus, telling students at IIM-A, “The key is to go beyond looking at the world through the lens of your company or your organisation or even your country.” Taking up the top position at the World Bank, an organisation that provides billions to developing nations every year, seems a natural next step for Banga, and the Bank’s mission to eliminate poverty ties in well with his personal philosophy of doing well and doing good. As he said in his convocation speech, “Both the private and the public sector have a role to play in the following: bring[ing] more people into the financial mainstream – at a time when half the world’s adults don’t have a bank account, guard against a future where we have the Internet of Everything, but not the Inclusion of Everyone, give women [the] same opportunities as men.”

One and all
Inclusivity has been a key message throughout Banga’s career, and with his appointment at the World Bank, he not only brings a drive to improve financial inclusivity around the world, but also a viewpoint shaped by different experiences than the vast majority of the institution’s previous leaders. In addition to Banga’s strong credentials, he holds an American passport, which is an informal prerequisite for the president of the World Bank. But equally importantly, his upbringing took place outside the US.

Since the founding of the international financial institution in 1944, the US, as the largest shareholder, has nominated and chosen its leader. On the other side of the Atlantic Ocean, the head of the International Monetary Fund (IMF) has always been chosen by western European nations. Previous heads of the World Bank include bankers and economists who were all, notably, American, while leaders of the IMF have historically always been European. These conventions have been called into question in recent years, with Mark Sobel, chair of the US Official Monetary and Financial Institutions Forum, saying in 2019 that it was time for a non-American to lead the World Bank.

Leadership attributes are tremendously facilitated if you surround yourself with people who don’t look like you, don’t walk like you, don’t talk like you, and don’t have the same experiences as you

“The changing global economic landscape makes the convention outdated,” he wrote. A non-American president would entrench the World Bank as a global institution, he argued. “In the past, the international financial institutions were closely associated with hegemonic US priorities. Yet this is far less the case today. Choosing a president who is neither American nor European would enhance the global standing of the fund and bank. That would helpfully counter the drift toward regionalism, when opaque Chinese official lending is challenging the scale of, and standards for, multilateral finance – undermining debt sustainability in many countries.”

With the nomination of Banga, US president Joe Biden stuck to the letter of the informal agreement while also seemingly attempting to address the voices clamouring for a break from convention. In fact, as well as praising his three decades building and managing successful, global companies, Biden noted that Banga’s background made him uniquely qualified for the job. “Raised in India, Ajay has a unique perspective on the opportunities and challenges facing developing countries and how the World Bank can deliver on its ambitious agenda to reduce poverty and expand prosperity,” Biden said.

Banga himself has spoken of the benefits of fostering inclusivity. “Leadership attributes are tremendously facilitated if you surround yourself with people who don’t look like you, don’t walk like you, don’t talk like you, and don’t have the same experiences as you,” Banga said to students at IIM-A. He went on to explain that a lack of diversity results in homogenous thinking. “Diversity is essential because a group of similar people tends to think in similar ways, reach similar conclusions, and have similar blind spots. To guard against that, you need to harness the collective uniqueness of those around you to widen your field of vision – to see things differently, to fail harder, to innovate, and to question everything,” he said. “Widening that field of vision means widening your worldview.”

A new playbook
Banga’s inclusive perspective is more than just talk. Soon after his appointment in June 2023, he announced he would be embarking on a months-long global tour as part of his aim to write a new playbook for the World Bank. By visiting multiple countries in every region where the bank operates, he was tasked with getting to know the areas in which the bank operates on a deeper level, rethinking the bank’s strategic partnerships and identifying opportunities to boost private sector investment.

Development, the bank has acknowledged, has become more difficult in the face of several intertwined challenges: poverty, climate, pandemics, conflict and fragility. These forces have “eroded a decade of progress in a matter of months,” the institution said in a press release. During his global tour, Banga said countries around the world are experiencing these challenges differently. “The World Bank Group must reach out to all of them and we need a new playbook to do it.”

Banga has asked staff to help him write the bank’s new playbook by thinking creatively, taking informed risks and forging new partnerships. Risks are nothing new for Banga; he has built his career taking what he calls “thoughtful risks.” Being willing to make a decision when you don’t have all the information, he said at IIM-A’s convocation, is what it means to take a thoughtful risk. “The thoughtful part depends also on your humility and realising that you don’t have all the answers – that you can learn something from everybody,” he said. Yet in many cases for Banga, the topics and issues that are at the top of his agenda as president of the World Bank are familiar, having been key priorities for him throughout his career. Homi Kharas, a senior fellow with the Centre for Sustainable Development at Brookings, the non-profit research group, pointed out in the group’s podcast, The Current, that Banga in 2014 launched Mastercard’s Centre for Inclusive Growth, which advances equitable and sustainable economic growth and financial inclusion around the world, “well before many of these things became fashionable in development circles. So the chances are that these are things he truly believes in,” Kharas said.

The climate question
A key focus of Banga’s efforts is to update the World Bank’s mission statement to focus on eliminating poverty ‘on a liveable planet.’ Banga explained on his tour, “What I mean by liveable is climate, but also pandemics, and also fragility and food insecurity. How do you eliminate poverty if you can’t breathe, you don’t have clean water, you’re scared of Covid and you’re a refugee, and you can’t eat? I don’t understand how these are either-or. To me, they’re together.”

Banga’s view on climate change makes a stark change from David Malpass, the previous head of the World Bank who was appointed by former president Donald Trump. Malpass had been criticised for his approach to climate change, with Al Gore, a previous US vice president, calling him a climate denier after he wouldn’t say whether he thought fossil fuels were driving climate change. Malpass announced his retirement about a year before his term was due to end to “pursue new challenges” – but this conveniently coincided with US Treasury secretary Janet Yellen’s push to reform multilateral development banks like the World Bank. Following his nomination of Banga, Biden credited his “critical experience mobilising public-private resources to tackle the most urgent challenges of our time, including climate change.” Banga had been an advisor to General Atlantic’s climate-focused fund, BeyondNetZero, when it was created in 2021.

Kharas agreed that Banga’s plan to tackle climate change is a common-sense one. “We have to think about development, economic development, with an understanding that this is now economic development in the context of climate change. And if you don’t integrate your activities on climate, in particular on adaptation and resilience with your activities on development, you’ll get neither the one nor the other. You’ll fail on both. So it’s very much of an integrated agenda.”

Indeed, with many of the nations that are most vulnerable to the impacts of climate breakdown already living in extreme poverty, increasingly common disasters like hurricanes, earthquakes and floods will impact on their infrastructure and ecosystems, likely pushing them further into debt. Expanding the scope of the bank’s mandate will require additional funding – the World Bank simply can’t do it all on its own. What will the bank do to boost its resources, and how will Banga persuade stakeholders of the need for a far larger World Bank?

Forging partnerships
In 2022, Yellen announced efforts to reform the bank, after an independent report for the Group of 20 economies (G20) found that development banks could free up hundreds of billions of dollars by adjusting their balance sheets and taking on more risk. The bank’s steering committee has endorsed an ambitious set of reforms including balance sheet changes that will boost the bank’s lending by $50bn over 10 years while crucially maintaining its AAA credit rating.

It is no surprise then that Banga and Yellen have agreed that the bank must work to harness more private capital. A recently formed ‘private sector investment lab’ for the World Bank held its inaugural meeting in September at the UN general assembly. Forging these partnerships is critical to Banga’s success. “One of Banga’s signature achievements may well be in bringing the private sector to play a more prominent role in development and climate finance,” Shastry told World Finance. The first-of-its-kind committee of CEOs are brainstorming solutions, and many industry commentators are optimistic about the partnerships that can be developed.

However, while many would like to see the World Bank “make a quantum leap forward in terms of the volumes of finances it provides poor and middle-income countries,” Landers told World Finance, there are “a lot of somewhat unrealistic expectations out there around how much the bank can grow its balance sheet through financial innovations, and shareholders’ willingness to put in big amounts of fresh new capital.” What’s more, in addition to finding partners for funding, Banga must also work closely with individual countries to understand the impact of integrating climate and development work, including managing the transition in countries whose economies rely heavily on fossil fuels like coal. “Many developing countries are dependent on fossil fuels for their public finances,” Kharas said. “In fact, if you look at the continent of Africa, a lot of the tax revenue in Africa comes from energy sources, whether it’s oil or gas or coal or other kinds of natural resources, they need to manage a transition, which is not going to be easy. And that’s where I think having a partner like the World Bank can be very helpful.”

Challenges ahead
While Banga is laser-focused on boosting the bank’s function to deal with climate change, “he will face considerable headwinds as the US-China strategic competition will conflict with his expansive agenda,” Shastry said. Another reason western nations are backing a larger role for the World Bank is to give developing countries more funding options to reduce their dependence on China. “It is essential that we offer a credible alternative to the People’s Republic of China’s coercive and unsustainable lending and infrastructure projects for developing countries around the world,” the White House said in August.

Banga’s career trajectory shows the development of a leader who would become a perfect fit for the World Bank

Yellen echoed this sentiment in a speech to a US House of Representatives committee, where she said World Bank loans “serve as an important counterweight to non-transparent, unsustainable lending from others, like China.” Despite this, Banga has said he “doesn’t view China as a rival” in providing funds to developing countries. “You need everybody at the wheel,” he said in an interview for Bloomberg.

Banga’s optimism for the task at hand is evident, but Landers warns that transforming the World Bank will not be a simple task by any means – and if “the stars don’t align” his work will be nearly impossible to accomplish. “He faces two equally daunting challenges,” Landers said. “First, the bank is a notoriously hard tanker of an organisation to steer in a radically new direction. Second, he will need to forge a consensus vision amongst a group of countries who are increasingly far apart in the context of today’s fragmented geopolitics. The first task requires a seasoned manager. The second task, a shrewd diplomat. It’s an uphill but not impossible feat to pull off.”

The universal space race

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In 2001, entrepreneur Dennis Tito became the world’s first space tourist; flying in a Russian Soyuz spacecraft, he docked at the International Space Station (ISS) and spent seven days in orbit. Roll on 22 years, and Tito has been joined by a growing list of space tourists keen to cast off the shackles and delve beyond the boundaries of earth. In May, a group of four private, paying astronauts docked at the ISS on a mission with Axiom Space, while in August, Virgin Galactic finally sent its first paying customers to the edge of space on a 90-minute mission. SpaceX is setting its sights even further with its Starship rocket, due to fly around the moon with a handful of guests on board in the coming years.

Private sector boom
These recent endeavours mark the latest in a string of space-related activity – and it’s no longer limited to state programmes. “What we’re seeing right now is a kind of a boom in the market that we haven’t seen in the past 30 or 40 years,” Marco Caceres, Space Analyst at Teal Group, told World Finance. “You now have rockets launching three or four or five times a month, whereas in the past, it was more like five or six times a year,” he says.

“What’s different now is that commercial companies are starting to take the lead. NASA is still there as a dominant player in the market, but you’ve got thousands of new companies building small rockets and satellites.”
NASA is now contracting private firms for much of its work; SpaceX and Blue Origin are currently developing landing systems for its upcoming Artemis missions, for example, which – if all goes to plan – will see humans land on the moon for the first time in more than five decades next year.

NASA is now contracting private firms for much of its work

That’s bringing a slew of new business and investment opportunities, and not just in space tourism; satellite communications, spacecraft manufacturing, spacecraft-derived data and in-orbit management are among the key opportunities in a global space economy valued at $469bn in 2021, according to the Space Foundation.

Over $47bn of private capital has been invested in the space sector since 2015 – marking an average growth rate of 21 percent per year – and the industry is predicted to hit a value of $900bn by 2030, according to UBS.

In the UK, space services underpin 18 percent of GDP (or £370bn), according to the UK Space Agency; it’s clear the sector is ripe with opportunity.

Suborbital flights
It’s not just investment opportunities that the private takeover is creating though; it’s also speeding up advancements at an unprecedented rate, bringing us ever-closer to sci-fi dreams of space holidays and life on Mars. UBS has estimated the space tourism market alone will be worth $4bn by 2030 (see Fig 1). “While space tourism is still at a nascent phase, we think that as technology becomes proven, and the cost falls due to technology and competition, space tourism will become more mainstream,” analysts Jarrod Castle and Myles Walton wrote.

Suborbital flights – which fly up to a certain height but don’t reach orbit, then drop back to Earth – are the first step, and Virgin Galactic’s recent take-off looks set to be the start of many more. Virgin Galactic eventually plans to run more than 400 flights a year, and it’s not without demand, with 800 tickets already reportedly sold.

Jeff Bezos’s Blue Origin has run 22 successful missions since its inaugural flight in 2021, sending a total of 31 customers into space so far. Other companies such as Space Perspective and World View are planning, if approved, to enter the sector by offering suborbital balloon flights.

Commercial viability
Craig Curran, President of the US-based DePrez Group of Travel Companies, sells Virgin Galactic flights as a space travel agent and says demand is strong. “I think this is a very viable marketplace and there’s ample demand for the products that are out there, especially among open-minded, big-thinking clients,” he says. “I’ve seen a lot of growth in the area as a lot more products have come online.”

But some are a little more sceptical as to how far the potential for suborbital can really go. “Companies like this are essentially selling a service that focuses on getting people into sub-orbit for a few minutes of microgravity time, so you can only create so much excitement within the public,” says Caceres. “Virgin Galactic has been trying to develop this market for the last decade, and they’ve had a few setbacks – it’s not moving particularly fast. I think if you’re just providing a few minutes of microgravity time, that’s going to get old.”

Virgin Galactic currently has around $980m in cash, according to its second quarter financial report, but that would run out within two years at the current burn rate, according to journalist Jonathan Miller. “Even if Virgin Galactic can maintain the tempo of flying into space every four to six weeks or so, it will lose a fortune,” he wrote in an article for The Spectator. “Since a chunk of the spacecraft’s engine must be replaced after every flight, these missions are operating at a loss.”

Each flight carries only three paying passengers, meaning there’s a limit to how much can be pocketed. How these companies fare will depend on whether costs can be brought down, and how safe they’re deemed to be; only time will tell how long their shelf life lasts.

Holidays on the space station
The bigger, longer-term opportunities might just be in orbital tourism – that is, crossing the Kármán line, or the edge of space, and going into orbit. This requires significantly faster speeds than orbital (17,400 mph, compared to around 3,700 mph for suborbital), bringing with it huge expenses and risks; but it’s already been done a handful of times.

Since Dennis Tito’s voyage in 2001, Space Adventures has sent seven clients on successful missions to the ISS. NASA opened up the space station to private missions in 2019, and SpaceX jumped at the chance. Last year, the company worked with Axiom Space to send three tourists to the station on its Crew Dragon capsule, marking the first time multiple tourists had gone together. Axiom sent a further four paying customers to the ISS earlier this year.

But it’s not just visits to the ISS opening up opportunities; NASA plans to decommission the existing station in 2030, replacing it with private, commercial space stations that could be used by both the government and paying customers. In 2021, the agency awarded a total of $415.6m in contracts with three private companies – Blue Origin, Nanoracks and Northrop Grumman Systems Corporation of Dulles – to develop these stations.

“With commercial companies now providing transportation to low-Earth orbit in place, we are partnering with US companies to develop the space destinations where people can visit, live, and work,” said NASA Administrator Bill Nelson in a statement. “This will enable NASA to continue forging a path in space for the benefit of humanity while fostering commercial activity in space.”

It’s not just space stations being developed; Above: Space Development Corporation (formerly Orbital Assembly) is going one step further with plans for two space hotels that would offer tourist activities including stargazing, ‘low-gravity trampolining’ and ‘low-gravity basketball’. Its first, Pioneer Station, is ambitiously scheduled for 2025; the second, Voyager Station, for 2027 (with capacity for 400 guests). Whether and when these concepts become reality is firmly up in the air.

A more realistic goal in the coming years is likely Axiom’s commercial space station, being developed for use by 2030 as an extension to the existing ISS under a NASA agreement signed in 2020. The module would offer research, manufacturing and tourism among its activities, and later be used as a core of its own, independent station.

Carceres believes this is where the real opportunities lie. “I think when you have private space stations that are run primarily for commercial purposes, that’s when you’re going to see that potential boom in space tourism,” he says. “I think the key is for these companies to not only get you into orbit, but to actually get you somewhere you can stay for a while.” How long these might take to be built remains to be seen; it took NASA and its partners more than 10 years to assemble the ISS, while China’s Tiangong station, completed in 2022, was developed in less than two years. Private backing might just accelerate the process.

Costly business
Of course, not all of this is likely to be plain sailing (or soaring), with immense barriers to overcome before space tourism could even start to edge its way into the mainstream. Among the biggest by far is cost; SpaceX’s voyages to the ISS in partnership with Axiom come with an estimated price tag of $55m. Add in specialised training, health checks and other costs, and the total likely racks up to significantly more. Compared to that, Virgin Galactic’s suborbital flights sound like something of a bargain at $450,000 per seat (Blue Origin’s remain a mystery, and vary depending on the customer). It’s still hardly affordable to the everyday consumer, though.

Developments in technology are crucial to lowering the costs, and efforts are underway. Researchers are looking into advanced propulsion systems to generate more power with less fuel, for example, while 3D printing can help lower manufacturing costs. California-based start-up Relativity Space launched the world’s first fully 3D printed rocket into orbit in March, marking a major milestone – it plans to use the rocket, Terran–1, to launch satellites into orbit for other private companies as well as NASA.

Reusable rockets are also key to bringing down the price point. SpaceX made history when it made its Falcon–9 partially reusable, with its most expensive parts able to be recovered. This October, Spanish start-up PLD Space launched its own recoverable Miura–1 rocket, marking Europe’s first fully private rocket launch. Blue Origin is also developing a reusable orbital rocket, New Glenn, while SpaceX’s Falcon Heavy – a partially reusable, heavy-lift launch vehicle – has reduced costs by 65 percent, according to a study by the University of California, Reusable Rockets and the Environment.

But so far, only a small handful of companies have succeeded in actually producing these. With minimal competition, the likes of SpaceX and Blue Origin can set their prices without fear of being undercut. Luigi Scatteia, Global Space Practice Leader Partner at PwC, believes a higher volume of flights is needed to really bring the prices down.

“Costs can only go down with routine operations and high cadence,” he told World Finance. “For that, you need higher confidence in the systems and a stronger and clearer regulatory framework.”

Safety issues
That increased confidence relies on one of the other biggest barriers being addressed – safety. For many, the prospect of shooting off into space at speeds of over 17,000mph is likely to bring more risk than reward. Several accidents haven’t helped; in 1986, NASA Challenger exploded shortly after lift-off, killing all seven crew members, including high school teacher Christa McAuliffe – the first in a string of civilians due to fly with NASA as part of a special programme. For years, it put an end to civilians flying to space with the agency.

In 2014, Virgin Galactic’s SpaceShipTwo (VSS Enterprise) suffered a catastrophic crash, resulting in the death of one of its pilots. SpaceX’s Falcon–9 meanwhile exploded on the launch pad at Cape Canaveral Air Force Station in Florida in 2016, destroying the satellite it was carrying. Artificial intelligence could help reduce the risk of human error – SpaceX’s Crew Dragon spacecraft uses an automated docking system that doesn’t require human intervention, for example. But radiation exposure and other health concerns also need to be addressed if space tourism is to move more firmly into the mainstream; how and at what cost remains to be seen.

“If you go months and months or years with dozens of people going into sub-orbit and eventually into orbit and there’s no major accidents, then the industry will slowly grow,” says Carceres. “But if you start to see a series of catastrophic accidents, I think that will of course slow things down.”

It’s not just safety concerns that need to be overcome, of course; the environmental challenges are significant, with rockets releasing carbon emissions alongside large quantities of soot and alumina particles. The effect of those emissions is also different when released in other parts of the atmosphere, according to Eloise Marais, Associate Professor in Physical Geography at University College London. “When we compare the amount emitted from rocket launches to aircraft, it doesn’t sound like a lot,” she said in a recent article. “But this comparison was always erroneous. When pollution is released into the upper layers, it lasts for a longer time than earthbound sources.”

Marais and a group of other researchers studied the impact of space tourism promoted by the likes of Blue Origin and Virgin Galactic using a 3D model; they found black carbon emissions would more than double after three more years of space tourism launches. They also found that particles given off by rockets hold heat in the atmosphere 500 times more than soot from any other source – which could speed up climate warming and impact the recovery of the ozone layer.

Electric propulsion systems that use less fuel are under development to help address the issues, alongside research into various fuel alternatives (current fuel types RP–1 and UDMH – the latter dubbed ‘Devil’s venom’ – are notoriously pollutive). SpaceX’s Raptor rocket engine, the European Space Agency’s Prometheus engine and Blue Origin’s New Glenn rocket are all designed to use liquid methane, which performs better than other fuels and comes at a lower price point – but methane is known as being one of the worst gases for global warming. Other firms are researching different solutions; UK-based orbital launch company Orbex uses renewable biofuel bio-propane to fuel its rocket, for example, resulting in 96 percent fewer emissions than fossil fuelled alternatives, according to research by the University of Exeter. These are promising signs, but there’s still a way to go.

Debris in space
Alongside carbon emissions, there are other concerns. De-orbited satellites are already causing a mass of debris in space – and that will only grow when more are released (up to 100,000 new satellites could be operational by 2030, according to the UK Space Agency – compared to just 11,000 in the past 60 years).

“There’s a lot of trash just floating around in space, and the question is what the environmental impact of all these unused, discarded satellites will be,” says Carceres. “One of the concerns by astronomers is also that we’re not going to be able to have clear views of the stars because of all these satellites,” he adds. “In five or 10 years, you may have a hard time seeing the constellations out there because you see all of this hardware in orbit. I think we don’t fully understand the potential climate and environmental impacts of a robust space industry, but we’ll have to take that as it comes. Unfortunately, we don’t enter these new industries factoring in all the potential downsides,” Carceres continues.

Regulatory review
Despite these concerns, governments look set to press ahead, capitalising on the vast, still largely untapped, economic opportunities the space industry is likely to bring. That brings with it a need for increased regulation – much of which is still nascent. In the US, the Federal Aviation Administration (FAA) is responsible for approving commercial rocket launch operations and has basic regulations around training private astronauts. But it’s all relatively light – and there’s very little regulation around the environmental impact of rockets and debris.

A lack of global framework is also problematic. “While there are a few national regulations in place, there is no single global standard for the industry,” wrote Marcin Frackiewicz, Founder of satellite internet provider TS2 Space, in an article. “This makes it difficult to ensure that all space tourists are adequately protected, as different countries may have different safety requirements.”

Colonising the Moon and Mars
These issues might just become more prevalent if the biggest ambitions of SpaceX and NASA are realised: colonising other celestial bodies. When SpaceX first broached the concept of colonising Mars back in 2001, few took the idea seriously. 22 years and a whole fleet of seemingly impossible achievements later, and it’s no longer being quite so raucously laughed at. NASA is investing in lunar exploration with its upcoming Artemis programme, with the aim of exploring opportunities for potential colonisation. “America will lead the monumental shift that frees humanity from our innate bonds to Earth,” says the agency in its Artemis programme overview. “This is the decade in which the Artemis Generation will teach us how to live on other worlds.” Using its Orion spacecraft, NASA plans to shuttle astronauts to the Artemis Base Camp, where they’ll be able to live and work.

“We will collaborate with commercial and international partners and establish the first long-term presence on the Moon,” reads NASA’s website. “Then, we will use what we learn on and around the Moon to take the next giant leap: sending the first astronauts to Mars.”

NASA’s Perseverance rover has already been conducting experiments on Mars since February 2021, searching for signs of past life and preparing the planet for future exploration. China is also playing its part in the space race (see Fig 2), with plans to send astronauts to the Moon by 2030 and build an International Lunar Research Station. SpaceX is meanwhile planning a second test flight for its Starship spacecraft – the biggest and most powerful rocket ever built, designed to carry humans to ‘the Moon, Mars and beyond’ – with several improvements made following its first (unsuccessful) test in April.

Universal ambitions
Many experts believe these ambitions are achievable, if the determination is there. “I believe that humans could colonise the moon and then Mars, if enough effort is put into such endeavours,” says PwC’s Scatteia. “Of course, the roadmap to that requires developments in space resources extraction and utilisation, and in-space manufacturing.”

But it’s unlikely to be an easy journey. Given the already significant challenges to overcome for even orbital flights to take off into the mainstream, it’s not hard to imagine the obstacles that would need to be addressed before humans could move to the moon. Politics is one; an international space race is likely to have countries clamouring to claim another celestial body as their own.

Developments in technology are crucial to lowering the costs

“You would hope that there would be some sort of international agreement that would say Mars is not going to be claimed by any one country,” says Carceres. “Because inevitably, politics does get in the way.” A bigger issue still is safety. “These rockets carrying colonists that Elon Musk first envisioned are going to carry hundreds of people, and inevitably some of them are going to explode – and then you’re going to have some major setbacks,” he says.

“But if the human will is there, eventually it will happen – I think it’s very likely that you could see the first human landing on Mars in a decade, especially with the vision of a private company like SpaceX.”

Only time will tell if we’ll make it. But with both private and public players now collaborating on a global scale and space developments advancing at a rapid rate, we’re inching closer than we ever have before. That brings with it a whole raft of philosophical questions that right now no-one can answer. And the first that needs to be addressed is this: how can we learn from our mistakes on Earth and ensure we don’t wreak havoc on the wider universe where the potential for damage is, quite literally, infinite?

Health is wealth

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Death is the ultimate inevitability – it is one of life’s only certainties. For all of our advances in medicine and technology, it remains the one human malady that can’t be cured. But not according to a growing number of extreme longevity pioneers. For them, escaping death isn’t just a science fiction fantasy, but something they believe may be possible for humans of the future.

Tech entrepreneur Bryan Johnson is the poster boy for this emerging group of immortality obsessives. While he may not be a household name compared with fellow billionaires Elon Musk and Jeff Bezos, Johnson has garnered much media buzz over the past year. Dubbed ‘the man that’s ageing backwards,’ he has been eager to share his $2m-per-year extreme anti-ageing regime with his followers on social media.

As routinely shown in videos uploaded to his YouTube channel, from the very moment he wakes up each day, every minute of Johnson’s life is engineered towards achieving one specific goal: reversing the ageing process. A team of over 30 doctors and health experts are on hand to monitor his every move, using real-time data to implement a strict and uncompromising health regime.

If Johnson’s data-driven algorithm tells him to take over 100 pills a day and wake up each morning at 4.30am, then that’s exactly what he does. He has even experimented with injecting himself with his teenage son’s plasma in an effort to further reduce his ‘biological’ age. The routine is certainly not for the faint-hearted – but Johnson is far from timid when it comes to his approach. In fact, he embraces his position as a human guinea pig, claiming that his work on longevity will usher in “the most significant revolution in human history.”

While Johnson is an extreme case, he is certainly not alone in his quest for a longer, healthier life. Biohacking may seem like a niche hobby for the ultra-rich, but many of its core principles and practices are slowly trickling into the mainstream. According to McKinsey, the global wellness market is now worth more than $1.5trn, and continues to grow.

In a post-Covid world, we are spending more on health and wellbeing than ever before, with wearable fitness trackers, vitamin capsules and supplement shakes now a part of daily life for many. With millions of people around the world embracing daily monitoring of their health and fitness progress, Bryan Johnson’s world of biohacking and rejuvenation doesn’t seem like the fringe idea it once may have been. But how far will the average citizen go in their quest for wellness – and at what cost?

Memento mori
What happens in Silicon Valley rarely stays in Silicon Valley. The North California technology hotspot has birthed some of the most innovative and ubiquitous products of the past three decades, changing the very nature of our world in the process. Ideas that originate in Silicon Valley soon ripple across the globe, attracting the attention of tech enthusiasts before entering the mainstream. And the next obsession du jour is extreme anti-ageing.

In 2022, Amazon founder Jeff Bezos reportedly invested in Altos Labs, a new biotech company focused on reversing the human ageing process through ‘cellular rejuvenation programming.’ PayPal co-founder Peter Thiel has donated over $3m to the Methuselah foundation, a biomedical charity that seeks to extend the healthy human lifespan and ‘make 90 the new 50 by 2030.’

Both men were early investors in Unity Biotechnology, a firm that seeks to ‘slow, halt or reverse diseases of ageing.’ And while Bezos and Thiel may be among the firms’ best-known backers, they certainly aren’t the only ones throwing money at these radical new fields of study. Altos Labs has succeeded in raising $3bn in funding for its work, which will be carried out in two labs in the US and one in the UK by an all-star team of scientists – with a number of Nobel laureates among the ranks.

Longevity, it seems, is the next frontier for Silicon Valley. According to Thiel, scientific breakthroughs in anti-ageing research will allow us to eliminate age-related disease “in the same way that we can fix the bugs of a computer system.” And death, he says, will be “reduced from a mystery to a solvable problem.”

With billions being poured into new biotech firms, investors are betting big on life-extending innovations. But despite Silicon Valley’s enthusiasm for ‘solving’ ageing, these companies are only at the very beginning of their research, with any significant breakthroughs likely to be many years away. In the meantime, though, the tech world’s longevity enthusiasts are focusing on what they can control – achieving ‘perfect’ health in the here and now.

And they don’t want to keep their wellbeing secrets to themselves. They are committed to bringing them to the masses – but it won’t come cheap.

Wellness at a cost
From Bryan Johnson’s $37-a-bottle ‘longevity’ olive oil to Freshology’s $130-per-week premium food delivery service, it appears that health now comes with a hefty price tag. And while it is certainly true that there is no need to part with such eye-watering sums of money to enjoy a healthy lifestyle, data shows that consumers are increasingly prioritising spending on wellbeing.

‘Wellness’ is a vague and fluid term, and has come to encapsulate everything from fitness and nutrition to mental health and spiritual balance. In recent years, consumers have been taking a more holistic approach to their health and fitness goals, embracing the concept of ‘wellness’ with open arms. According to a 2022 study carried out by McKinsey, 50 percent of US consumers now consider wellness to be a ‘top priority’ in their day-to-day lives. The firm predicts that the wellness market will continue to grow by up to 10 percent each year over the next decade, as wearable technology, nutrition apps and on-demand fitness services increasingly become fixtures of our everyday.

Incredibly, this wellness boom could see the market reach a $7trn valuation by 2025. In a post-Covid world, consumers have increasingly looked to take their health into their own hands, with a surge of interest in personalised, data-driven trackers and devices. For many, the pandemic served as a stark and unwelcome reminder of the importance of good health – both individually and collectively. Many of the wellness trends ushered in by repeated lockdowns have lingered long after the world’s great return to ‘normal,’ with remote fitness classes and mindfulness apps still proving popular with consumers in a post-Covid climate (see Fig 1).

The most significant trend that the pandemic accelerated, of course, is digitalisation. Almost overnight, most facets of our lives moved online, prompting a digital transformation of society that might have otherwise taken years to materialise. The wellness industry, too, was pushed to adapt to a digital era – something it managed with aplomb.

Customers are increasingly comfortable with trading their privacy for personal reward

In 2020, a record 527 million wearable fitness devices were sold, up from 384 million the year before. With gyms closed and group exercise classes no longer an option, housebound consumers turned to devices and services that could keep them focused on their goals while lockdown measures remained in place.

Wellness brands rushed to expand their online offerings, with health and fitness apps generating just shy of 2.5 billion downloads in 2012. The meal kit market also saw a sustained surge in demand, with provider Gousto seeing its sales rise by 129 percent over the course of 2020, allowing it to achieve coveted ‘unicorn’ status. Rival provider HelloFresh also saw impressive revenue growth of 122 percent in the second quarter of 2020, while the vitamins and supplements market also noted a significant jump in sales. Consumer spending might have slumped in most areas during the pandemic, but the wellness space boomed. With no signs of the wellness trend cooling down post-pandemic, the door has been opened to a new wave of health-related products and services for spend-happy customers.

Future-proofing wellness
The wellness market is growing ever more crowded. New companies continue to spring up with remarkable regularity, each offering an innovative solution to whatever may be ailing you – whether that be a lack of sleep, low energy or an insufficiently challenging workout plan. Despite the variety of wellness products and services flooding the market, consumers are still hungry for more. Last year, McKinsey found that a third of survey respondents expressed a desire for additional products and services in the wellness space, with a significant portion of those surveyed saying that the current offering is simply insufficient to meet their needs.

Millennials and Gen Z appear to be driving this booming trend. Indeed, the younger generations have a seemingly insatiable appetite for all things wellness, desiring products and services at a rate six to seven percentage points higher than those of any other age bracket. This is certainly good news for the thriving wellness market, which has successfully captured the next generation of consumers. Commanding a remarkable $360bn spending power, Gen Z is a lucrative market to unlock. But Gen Z consumers are also a fickle bunch, meaning that wellness companies can’t rely on returning custom and brand loyalty – they need to stay abreast of the latest trends in customer demands if they wish to stay relevant in an increasingly saturated market. And what might wellness innovation look like in the next five years? Well, in the case of millennials and Gen Z, wellness is all about personalisation. For digital natives who have grown up online, data sharing is part of the online experience.

While they are attuned to the risks of privacy violations, they have fewer qualms than previous generations about sharing their personal data – especially if that means they will have a more personalised and streamlined e-shopping experience. According to research carried out by McKinsey, 49 percent of millennials and 37 percent of Gen Z express a strong preference for highly personalised products, services and apps. From nutrition plans tailored to users’ diet preferences, BMI and activity levels, to customisable haircare products formulated to each customer’s hair length and type, brands have been quick to embrace personalisation. Soon, however, customers will start to expect this level of tailored offerings as the norm – meaning that wellness companies will have to get creative with new ways to keep things bespoke.

All industries – the wellness market included – will need to prepare for the oncoming artificial intelligence (AI) wave. But the wellness industry is already largely data-driven, making it a promising candidate for harnessing the benefits of AI. Already, a number of mental health apps are offering AI-powered therapy chatbots as part of their care packages, allowing consumers to access around-the-clock advice and support – albeit in text-only form. Leading mental health chatbot Wysa boasts of a user base of over five million people, and has partnered with the UK’s National Health Service to support patients through the mental health care pathway process, demonstrating the extraordinary reach this technology can have. With human therapists oversubscribed and in scant supply, chatbots may offer some comfort – but there remains some understandable scepticism over allowing a largely unregulated set of algorithms to carve out an expanding role for themselves in the mental healthcare space.

Shifting corporate culture
In the post-Covid world, consumers aren’t just prioritising wellness in their personal lives. Workplace wellbeing has risen up the corporate agenda at businesses large and small in recent years, with many employers offering wellness perks as part of their core benefits package. Free subscriptions to mindfulness apps and discounted offers on gym memberships and fitness classes are just some of the benefits that many workers have come to expect from their employers, but some firms are taking their wellness offer one step further.

In 2019, professional services firm PwC launched a pilot study to identify the benefits of wearable technology in the workplace. A group of UK-based workers were given a device to wear on their wrists, as they would a fitness tracker. Instead of recording exercise targets, however, this device was synced up to their work calendars and was designed to track the physical and mental impact of their working life. By measuring heart-rate-variability, the device showed pilot participants how particular work patterns were creating additional stress – whether that be back-to-back meetings or a lack of time away from the screen. Each participant could access a personalised dashboard with their mobility and body response data, and were able to see in real time how different working habits and practices were impacting them both physically and psychologically.

Their employer, too, had access to this anonymised data, and when the pilot came to an end, PwC began to act on the information it had collected. The data showed that workers needed to be encouraged to take more regular breaks, so the firm sought new ways to incentivise staff to spend some time away from their desks. This included empowering their managerial staff to introduce walking meetings, among other ideas, to encourage more movement throughout the working day.

Some workers might baulk at the idea of sharing their physiological data with their employer. Understandably so – there are certainly some real ethical questions to consider when it comes to this level of monitoring in the workplace. But, perhaps surprisingly, a 2021 poll carried out by PwC showed that more than 44 percent of respondents would be willing to use wearables and other sensors to track their productivity – and for this information to be shared with their employer if that led to benefits and improvements in the way they work.

If anti-ageing scientists do manage to unearth the mythical fountain of youth, it will come at a cost

Since the PwC trial, a number of other firms have launched their own wearable pilots. IHP Analytics, a company specialising in performance science, started its own trial during the first Covid-19 lockdown, with over 2,000 staff members volunteering to be part of the pilot group within four hours of its launch. This willingness to share such personal physiological information with employers perhaps reflects a wider shift in attitudes towards data sharing.

Indeed, if consumers are already sharing their physiological information with fitness firms such as Fitbit, and are content with passing along blood samples to nutrition science companies such as ZOE, then perhaps they are now less reluctant to give out this data elsewhere. In fact, research has shown that when customers feel that there are benefits to be gained from sharing their personal information – whether that be a more personalised service or a more convenient payment process – they are happy to part with their personal data. According to a poll carried out by PwC, 62 percent of respondents would be willing to use a wearable device if that meant they could reduce their health insurance premiums. In our data-driven age, it seems that customers are increasingly comfortable with trading their privacy for personal reward.

Recession-resistant markets
In the words of the IMF, “the global economy is limping along.” Recovery from the Covid-19 pandemic has been long and slow, while the far-reaching consequences of the Russia-Ukraine conflict have prompted cost-of-living crises in many developed economies across the globe. Inflation has soared in much of the world, and economists have warned that both the US and the UK may officially enter recession in the early months of 2024.

Against this decidedly gloomy economic backdrop, it is hardly surprising that consumers are looking to rein in their spending. Spiralling food and energy bills have meant that many people have found their disposable income to be dramatically reduced over the course of the last 18 months, and have cut down on what they deem to be ‘unnecessary’ expenditure. Indeed, a recent survey carried out by the UK’s Office for National Statistics (ONS) found that two-thirds of adults in the UK were spending less on non-essentials as a result of the rising cost of living.

You could be forgiven for thinking that this prolonged economic slump might spell trouble for the costly wellness industry. But if past recessions have taught us anything, it’s that certain industries have the power to defy downturns. In the early 2000s, Estée Lauder’s Leonard Lauder coined the term ‘the lipstick index,’ to describe how cosmetics sales tend to pick up during times of economic hardship. The concept is now an established economic indicator, with analysts noting how shoppers often turn to modest luxuries during downturns. And the same trend is once more emerging during the current cost-of-living crisis, with consumers looking to treat themselves and stay well even as they cut back on spending elsewhere.

In the UK, gym memberships are up by 3.9 percent compared with 2022, and retailers have noticed an uptick in beauty and cosmetics spending. A survey carried out by McKinsey at the start of the current cost-of-living crisis found that more than a third of customers around the world would ‘probably’ or ‘definitely’ increase their spending on diet programmes, nutrition apps, juice cleanses and food subscription services over the next 12 months. Despite widespread economic pressures on personal finances, it seems that we have never been so content to keep spending on wellness.

In the wake of the Covid-19 pandemic, concepts of wellbeing and self-betterment have become deeply ingrained in our personal and professional lives, with consumers embracing data-driven improvement plans and health ‘solutions’ like never before. It’s clear that there is a real appetite for ever more options in the wellness space – and consumers are crying out for highly-personalised products that monitor and respond to their physiological data.

With Silicon Valley’s brightest minds pushing the boundaries of biohacking, the future of the health and wellness industry might not be so far removed from the experimental pilots currently being pioneered by the world’s most prominent longevity enthusiasts. But one thing is for certain – if anti-ageing scientists do manage to unearth the mythical fountain of youth, it will come at a cost. In a generation of wellness-obsessed consumers, however, there may well be many who are happy to pay that price.