The Investment Outlook 2023
As we look back on 2022, to describe the year as eventful seems an absurd understatement. So many events have dominated the news, each individually significant, and in aggregate almost overwhelming in consequence, both politically and economically.
Here's a reminder of just a few of those events:
Climate crisis uncertainty
Yet all these things will be relatively short-lived in their impact (and manageable) when compared to the existential threat that continues to grow relatively unabated from our failure to make progress on constraining global warming to the agreed target of 1.5°C.
COP 27, the climate change conference held this year in Egypt, largely failed to expand on commitments made a year earlier with regards to phasing out fossil fuels, despite all the strong statements made around the necessity to do so.
The one major step forward was the agreement of a deal that has been sought for over 30 years to launch a fund for 'loss and damage' to support those nations most exposed to the consequences of climate change. But details and financial funding have not been agreed.
We can already observe more extreme weather events - notably the recent floods in Pakistan - which have devastating effects on impacted economies and contribute to the risk of a steady but dramatically expanded flow of migrants to other countries.
Don't give up
But, as the old saying goes, where there are challenges, there are also opportunities.
Here's where we see them:
Reasons to be optimistic
It's easy to be overwhelmed by all the uncertainty. That said, we've also seen steady progress in many places that may offer an antidote to the gloom:
2023 may well be a pivotal year for markets amid the economic challenges that remain. While these are clearly important, we mustn't take our eyes off potentially existential long-term issues.
Author: Sir Douglas Flint, Chairman of abrdn
Funds operated by this manager:
Aberdeen Standard Actively Hedged International Equities Fund, Aberdeen Standard Asian Opportunities Fund, Aberdeen Standard Australian Small Companies Fund, Aberdeen Standard Emerging Opportunities Fund, Aberdeen Standard Ex-20 Australian Equities Fund (Class A), Aberdeen Standard Focused Sustainable Australian Equity Fund, Aberdeen Standard Fully Hedged International Equities Fund, Aberdeen Standard Global Absolute Return Strategies Fund, Aberdeen Standard Global Corporate Bond Fund, Aberdeen Standard International Equity Fund , Aberdeen Standard Life Absolute Return Global Bond Strategies Fund, Aberdeen Standard Multi Asset Real Return Fund, Aberdeen Standard Multi-Asset Income Fund