"World Class Poverty"

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Lowlands 2025 Scenario4.jpg

Stagnating economy: 2005 – 2015:

The period between 2005 and 2010 is characterized by a stagnating GDP growth. Labour delocation increases caused by high labour cost. Approaching 2010 the EU cannot adequately cope with the Eastern enlargement and fails to reform her institutions. Rather then taking proactive measures, the EU becomes defensive and tries to protect its growing trade deficits and unemployment thru trade barriers, and immigration barriers. As consequence of this and by more appealing areas in the world educated immigration slows. New R&D centres are predominantly founded in Asian countries, because they can offer well educated and highly motivated staff at competitive cost. Moreover the R&D is close(r) to the production centres. Consequently R&D activities in the Lowlands loose ground.

The aging population in the Lowlands starts to become a financial burden, and the government lacks leadership to drastically reform the social security system. Rather then pursuing a step change approach the government decides on minor incremental changes: minor increase of the pension age, and a marginal shift towards private funding of pensions. From 2010 onwards the government ramps up gas production to somewhat compensate for the extra social security expenditure. Unemployment rate stays stable but the participation rate decreases behind the aging population. The already low consumer confidence further deteriorates. On top social stability is being challenged by a growing ethnic concentration, especially in the big 4 cities. The stagnating economy forces the government to lower the social security standards towards 2015. This causes social unrest.
Also internationally the outlook is rather pessimistic; increasing terrorism and new international conflicts further lowers overall morale of the population.

Conflict: 2015 – 2020:

GDP growth struggles to stay positive around 2015. The percentage of people with highly skilled jobs drops in favour of lower skilled jobs. Shortly after 2015 larger innovative corporations as Philips move their R&D centres to India and China, who lead on research and production.
The consensus that is needed for European reforms in social matters, subsidies and tax harmonization cannot be reached. The European constitution is still not established, and Brussels continues to micro manage country laws and rules rather then taking a holistic and pragmatic view. Multilateral cooperation is virtually non-existing. Around 2015 the Asian countries, especially India and China, dominate the global economical and political arena.
Real-estate devaluation takes place in the Lowlands and severely increases the mortgages of the citizens. Immigration lowers both by restrictive European measures and by the fact that other developed countries become more appealing for potential immigrants looking for a better life. The Lowlands now face the problem that their highly skilled workers increasingly emigrate to other parts of the world. The world is fragmented in a number of protected trade blocks, where Europe has fallen behind in GDP growth.
The increased segregation in the big 4 cities causes problems: increased criminality and even riots. Increased unemployment and further ethnic concentration lead to the foundation of extremist parties towards 2010. This includes an extremist Islamic party that represent the immigrants and an extreme right party to serve the disappointed and frustrated autochthones.
Shortly after 2015 a generation conflict takes place. The younger generations are so heavily burdened by the aging population that they take the country down, resulting in riots with the goal to drastically reform social security. The generation solidarity principle is changed. Mostly the poor, immigrant and elder people that don’t have enough savings or personal pension plans suffer from these measures.

Segregation & surging income inequality: 2020 – 2025:

The Lowlands are no longer leading innovators. GDP growth further suffers as a result of depleted gas fields. The Lowlands maintain their logistical hub function, and try to hold on to their strong trade reputation. Mac Peking and Star Asia start opening branches in the lowlands giving employment to low skilled workers. By 2025 the Lowlands and the rest of European are downgrading into a tier 2 continent. On an international the Lowlands have a marginal role. Innovative companies left the Lowlands and are active new in the new leading economic blocks.
As a consequence of the new social security system income inequality within the Lowlands soars. The Lowlands now have a small population of rich and a much more individualistic society. Technology in the form of weblogs enables a high degree of personalized and specialized content. Media is individualistic and focussed on the negative side of the news, hunting for sensation, emphasizing international conflicts and terrorism. The rich live separated from the poor in secured communities. Cities are segregated along ethnic lines. A Japanese phenomenon of Hikikomori finds it way into the Lowlands. This phenomena is the name for younger people from the Millenians generation that cannot cope with the social pressure of modern society. They isolate themselves in their houses and from their parents, quit going to school and trade their life for a virtual one on the internet (surfing, chatting and playing games).

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