BCG Henderson Institute Announces Four Scenarios for 2050: Global Economy Could Diverge Significantly Based on AI Advancement, Geopolitical Risks, and Climate Change

Boston Consulting Group (BCG)'s strategic think tank, the BCG Henderson Institute (BHI), has announced the release of its research report, "Beyond Tomorrow: Four Scenarios for the World of 2050" (hereinafter, the Report), which presents future visions for the global economy. The Report analyzes 100 years of time-series data and over 100 cross-cutting megatrends, including technology, geopolitics, climate, society, and economy, to present four scenarios that are expected to unfold by 2050.

Four Scenarios for Business Leaders to Consider

The Report details each of the four presented scenarios, examining what they mean for companies and businesses, and what early signals indicate the direction the world is heading. The research involved extensive expert interviews and stress tests. Future developments were organized for key areas such as technological advancement, global trade, and energy transition, and their interrelationships were examined. Combining historical data with future forecasts, the Report estimates how 20 indicators related to geopolitics, society, and the environment, including Gross Domestic Product (GDP) growth rates, might change by 2050. Based on this, four logically consistent and significantly different scenarios were constructed by combining multiple future visions (see chart). An overview of each scenario is provided below.

① Prosperity through AI Advancement: In this scenario, international cooperation in setting AI standards accelerates productivity growth, making technology and low-carbon energy more accessible. Global GDP is estimated to grow by approximately 5% annually, reaching more than three times its current level by 2050. Working hours decrease, with a 3-4 day work week becoming common in some regions. Furthermore, AI support advances the development of new materials and carbon dioxide removal technologies, leading to a path towards achieving net-zero, albeit with some delay.

② Conflicting Bloc Economies: This scenario involves a weakening of international cooperation and a restructuring of global trade. The scale of global trade, as a percentage of GDP, shrinks from 57% in 2024 to approximately 35%. Countries prioritize security and self-sufficiency, with defense spending estimated to reach the highest level among the four scenarios, at about 7% of GDP. Meanwhile, global GDP growth is estimated to remain at the lowest level, approximately 1.8% annually, supported by government spending on security, pensions, and climate change measures.

③ Cooperation Centered on Climate Change Response: Following a series of climate disasters in the late 2020s, governments, industries, and consumers prioritize climate change resilience, accelerating the transition to low-carbon energy and infrastructure. Global warming is estimated to stabilize at the lowest level among the four scenarios, approximately +1.8°C compared to pre-industrial levels. Carbon markets expand globally, with most major economies participating by 2040. The share of fossil fuels in total energy decreases from 81% in 2025 to 35% by 2050, and GDP is estimated to grow by approximately 2.5% annually, accompanied by population growth and aging.

④ Digital Darwinism (Technological Progress and Widening Inequality in Parallel): In this scenario, technological development continues with limited regulation, and GDP growth reaches 4%. However, the wealthiest 1% hold approximately half of the world's wealth, leading to widening inequality. AI and automation replace routine tasks, increasing the number of temporary and short-term contract jobs. While democratic nations decline and the global order becomes fragmented, trade and supply chains are maintained, supported by economic rationality.

Resilience Building and Rethinking Talent Strategy are Indispensable in Any Scenario

The Report presents five "no-regrets" action guidelines common to all scenarios for corporate leaders. By implementing these, companies can gain a head start in responding to environmental changes over the coming decades.

Building Resilience: Shift focus from efficiency to resilience, creating a system that can continue operations in an unstable environment through diversification of procurement sources and redesign of operational structures.

Rethinking Talent Strategy: To cope with the era of AI and aging populations, develop strategies that consider collaboration across a wide range of generations, flexible role design, and talent mobility, expanding recruitment targets to include emerging labor markets.

Improving Digital Infrastructure Flexibility: Design a "modular" technology and data infrastructure with independent functions to flexibly respond to rapid technological advancements. Emphasize ensuring reliability and cybersecurity.

Strengthening the Ability to Detect and Influence Change: Regulation