20 State Futures in the Global South

Introduction

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• Purpose
• Conceptual Framework

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Purpose

This theme uses a foresight-driven approach to explore the trajectory of state governance in the Global South over the next two decades. State governance refers to the structures, processes and practices through which states exercise authority, make decisions and manage resources to achieve societal objectives.

By applying a futures lens, the theme identifies emerging trends, innovations and strategic adaptations that could shape how states respond to complex and evolving challenges. The analysis is forward-looking but grounded in current dynamics, with the goal of informing more effective, inclusive and responsive governance models in a rapidly changing global context.

The theme seeks to answer the following:

1. What are the key forces shaping the future of state governance in the Global South, and how can policymakers anticipate and respond to these transformations?
2. What roles do technology, economic transitions, geopolitical shifts and non-state actors play in reshaping governance models, and how can states harness these forces for sustainable development?
3. What scenarios best illustrate the potential governance trajectories for the Global South, and what policy pathways can help states navigate toward equitable, stable and future-ready governance structures?
4. How can governments and institutions in the Global South build more resilient, adaptive and inclusive governance systems in the face of accelerating global disruptions?
5. How can futures thinking and strategic foresight be leveraged to inform governance strategies, ensuring that decision-making remains proactive rather than reactive in an uncertain world?

These questions position the theme as a forward-looking, strategic exploration rather than an analysis of current trends. Seeking to answer these questions emphasises the core role that anticipation, adaptation and transformation will play in Global South governance. 

Note: The theme links to an interactive display in the software tool Tableau, which is available here. It allows for easy data visualisation and disaggregated views (i.e., by country within each Global South group). 

Conceptual Framework

The analysis adopts two key approaches: a state-centric perspective and a Global South-focused lens. These complementary approaches allow for a nuanced examination of governance structures, state functions and their evolving role in response to global and regional transformations.

State-Centric Approach

The state-centric approach positions the state as the principal actor in governance, policy formulation and development. It focuses on how state institutions exercise authority, manage public resources and navigate domestic and international pressures. This perspective emphasises the state's role in shaping institutions, enforcing laws, delivering services and maintaining stability. The perspective is crucial in understanding the mechanisms of governance, the balance between state control and market forces, and the interactions between state and non-state actors, including international organisations, private entities and civil society. Focusing on the state allows for analysing how governance structures evolve in response to domestic and global forces.

Global South Perspective

The Global South-focused lens ensures that governance analysis remains grounded in the socio-economic, political and historical realities of these regions. Historical legacies such as colonial rule, structural adjustment programmes and geopolitical shifts have all influenced state-building processes, governance capacities and institutional effectiveness. This perspective accounts for the diversity of governance models across the Global South while recognising shared challenges, including economic dependency, legitimacy struggles and governance capacity constraints.  It also recognises the enduring relevance of indigenous governance systems, which continue to shape localised governance practices and offer valuable insights into resilience and legitimacy.

For the purposes of this theme, the Global South consists of seven regions namely Sub-Saharan Africa, the Middle East and North Africa (MENA), Latin America and the Caribbean, Central Asia (with Russia at its core), South Asia (with India at its core), Southeast Asia and East Asia (including China).

The Global North typically refers to high-income, industrialised countries, such as Canada, the United States (US), all EU countries, the United Kingdom (UK), Japan, South Korea, Australia and New Zealand.

Sub-Saharan Africa: Angola, Cameroon, Benin, Botswana, Congo, Kenya, Côte d'Ivoire, Equatorial Guinea, Sudan, Uganda, Niger, Guinea, Burkina Faso, Zambia, Malawi, Madagascar, Ghana, Mauritania, Togo, Gabon, Namibia, Nigeria, Rwanda, Senegal, Zimbabwe, DR Congo, Somalia, South Africa, Tanzania, South Sudan, Burundi, Cabo Verde, Central African Republic, Chad, Comoros, Eritrea, Eswatini, Ethiopia, Gambia, Guinea Bissau, Lesotho, Liberia, Mali, Mozambique, Sao Tome and Principe, Seychelles, Sierra Leone.

Middle East and North Africa (MENA): Algeria, Egypt, Bahrain, Djibouti, Iran, Tunisia, Jordan, Kuwait, UAE, Yemen, Qatar, Saudi Arabia, Iraq, Syria, Libya, Turkey, Oman, Lebanon, Palestine, Morocco.

Central Asia:  Kazakhstan, Turkmenistan, Kyrgyzstan, Tajikistan, Uzbekistan, Azerbaijan, Russia.

South Asia: Bangladesh, Maldives, Bhutan, India, Nepal, Afghanistan, Pakistan, Sri Lanka.

Southeast Asia: Brunei, Laos, Cambodia, Indonesia, Malaysia, Myanmar, Philippines, Singapore, Timor Leste, Vietnam, Thailand.

East Asia: China, Mongolia, Hong Kong, DR Korea, Taiwan.

Latin America and the Caribbean: Argentina, Brazil, Bahamas, Bolivia, Chile, El Salvador, Colombia, Costa Rica, Barbados, Belize, Cuba, Grenada, Guyana, Haiti, Honduras, Guatemala, Ecuador, Jamaica, Mexico, Dominican, Nicaragua, Panama, Paraguay, Peru, St Lucia, St Vincent, Surinam, Trinidad and Tobago, Uruguay, Venezuela, Grenada.

Global North: Australia, Bulgaria, Austria, Belgium, Canada, France, Croatia, Czechoslovakia, Slovakia, Poland, Sweden, Slovenia, Spain, Portugal, Greece, Germany, Finland, Hungary, New Zealand, Denmark, Ireland, Italy, Japan, Lithuania, Romania, South Korea, United Kingdom, Luxembourg, Netherlands, USA, Iceland, Israel, Latvia, Switzerland, Malta.

 

Intersections and Synergies

The combination of a state-centric approach and a Global South perspective provides a framework to examine how external forces, such as climate change, technological advancements and migration, reshape the state's role and the expectations placed upon it. This intersection highlights governance resilience, adaptation strategies and states' varying capacities to respond to global disruptions.

State Governance

At the core of this framework is the concept of state governance: the structures and processes through which a state organises, regulates and adapts its political, social and economic systems. Governance involves the distribution of power and decision-making authority among both state institutions and non-state actors, such as multilateral organisations, businesses and civil society groups. Beyond formal structures, it is also influenced by historical contexts, social norms and shared values, all of which affect a state’s long-term development and stability.

The evolution of governance is non-linear and varied. Seen from the perspective of the Global North, state governance is essentially viewed as a progression from non-democratic to democratic systems with the associated institutionalisation. That view often does not acknowledge the indigenous and historically unique governance systems that have evolved in many countries in the Global South, much of which has been hidden (or suppressed) by the dominant impact of imperialism, colonialism and more recently through a bipolar or unipolar system. As that overarching dominance declines with the rise of the Global South in population numbers and in economic size, new challenges and historical (or deep) drivers emerge that challenge the dominant development and governance discourse emanating from the Global North. Instead of democracy, the preferred destination for many countries in the Global South is accountable governance and structures that can strengthen this responsible governance.

Understanding how states in the Global South respond to these pressures helps us assess different governance models and their potential for sustainable and equitable development. Ultimately, this approach highlights the need for context-specific policy solutions that address the realities of a rapidly changing world.

Research Design

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• Futures Thinking and Strategic Foresight
• Methodology

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Futures Thinking and Strategic Foresight

Futures thinking is a systematic approach to anticipating and preparing for multiple possible future developments, but includes elements of traditional forecasting, which typically extrapolates from past trends. Futures thinking recognises that the future is plural, uncertain and shaped by dynamic interactions between social, technological, environmental, economic and political forces. It is a creative and exploratory process that uses divergent thinking, seeking many possible answers and acknowledging uncertainty. It is a different mindset from analytical thinking, which uses convergent thinking to seek the right answer and reduce uncertainty.

Key principles of futures thinking include:

• Multiple Futures: There is no single predetermined future; instead, a range of possible, plausible and preferable futures can be envisioned.
• Long-Term Perspective: Futures thinking extends beyond immediate concerns, considering long-term implications of decisions and trends.
• Systems Thinking: The future is shaped by interconnected forces; examining governance in isolation ignores crucial interactions with global and regional drivers.
• Participatory and Inclusive: Engaging diverse stakeholders, including policymakers and civil society, ensures that futures thinking is holistic and reflects multiple perspectives.

Futures thinking is particularly relevant to governance in the Global South, where rapid transformations—such as demographic shifts, technological advancements and climate impacts—require forward-looking strategies to build resilient and adaptive governance systems.

Why foresight matters for state governance in the Global South:

• Anticipating Disruptions: The pace of change is accelerating, from climate-driven displacement to Artificial Intelligence-driven governance. Foresight equips states with tools to anticipate and mitigate risks, while unlocking new ideas, opportunities and capabilities for the future.
• Policy Adaptability: Traditional governance models struggle with uncertainty; foresight enables the design of adaptive policies that can withstand shocks.
• Strategic Decisionmaking: By exploring potential futures, states can align national development strategies with emerging global shifts, positioning themselves more effectively in a multipolar world.
• Empowering Regional Voices: Foresight ensures that the Global South does not passively react to global trends but actively shapes its future through informed, proactive governance strategies.

By embedding futures thinking and strategic foresight into governance analysis, this theme aims to equip actors engaged with state governance in the Global South with the tools to navigate complexity and shape governance trajectories, moving beyond reactive policymaking to proactive governance models.

Methodology

The future of governance in the Global South is shaped by complex and interconnected global forces, ranging from geopolitical shifts and technological disruptions to climate change and economic transformations. Governments face mounting pressures to adapt to these changes while maintaining stability, effectiveness and legitimacy.

The theme employs a multi-method research design that integrates quantitative analysis, expert workshops and foresight methodologies to assess state governance trends and future trajectories in the Global South.

Quantitative Analysis

The research draws on the World Bank’s Worldwide Governance Indicators (WGI) and other global datasets to assess governance and development trajectories. Quantitative data is integrated with qualitative foresight techniques to provide a holistic analysis.

The International Futures (IFs) model is used to support this foresight-driven approach for trend analysis and creation of alternative futures. The IFs model simulates long-term trends across multiple domains, including demographics, economics, agriculture, education, health, infrastructure, energy, environment, technology and governance. By incorporating these interconnected sectors, the model ensures that scenarios account for the complex interactions that shape future development.

Expert Workshops

Several expert workshops, conducted virtually, brought together scholars, policymakers and practitioners. Experts were identified based on their backgrounds in governance and democracy across different regions. The recruitment process combined several approaches: leveraging team networks, acting on expert referrals and conducting targeted online research.

• Firstly, 40 experts participated in the methodology workshop in March 2024, which contributed to initially framing this theme's approach.
• Secondly, a Global North workshop was held in June 2024 to contrast insights from the Global South, with 13 experts attending.
• Thirdly, the Global South regional workshops were conducted in four groupings: Sub-Saharan Africa (SSA), the Middle East and North Africa (MENA), Latin America and the Caribbean (LAC) and Asia. Between 7 and 19 experts participated in each workshop.
• Finally, in March 2025, an internal workshop within the Institute for Security Studies explored the evolution of state governance in the four alternative global futures examined further below in this theme.

These workshops provided regional perspectives on governance challenges, helped to validate scenario assumptions and highlighted emerging governance trends. By engaging regional experts and incorporating workshop insights into the analysis, the theme captures governance challenges and opportunities from multiple perspectives, ensuring a more nuanced understanding of governance dynamics.

Foresight Methodologies

To systematically explore the future of governance in the Global South, the theme applies an integrated foresight approach that combines three key methodologies:

1. Horizon Scan: To identify and systematically analyse the key forces shaping governance trajectories in the Global South over the coming decades. This systemic approach explores political, social, technological, economic and environmental trends influencing the future of state governance.
2. Alternative Scenarios:
1. Scenario Framework: The AFI-ISS developed four global scenarios initially to explore Africa's potential development paths. In this theme, they serve as a structural framework for analysing how state governance in the Global South may evolve under different global conditions. Each scenario presents a distinct combination of geopolitical, economic and social forces, shaping governance outcomes differently.
2. Scenario Narratives: Building on these four global scenarios, this theme integrates insights from the horizon scan to enhance depth and relevance, grounding governance futures in contextual, interconnected development pathways.
3. Governance Outcomes: Governance trajectories in each scenario were evaluated using the Worldwide Governance Indicators (WGI). The indicators provide a multi-dimensional, data-driven framework that effectively assesses state governance in the Global South and the Global North, capturing both institutional capacity and democratic accountability across diverse political and economic contexts. Their comparability across countries enables benchmarking governance performance, while longitudinal insights allow tracking governance trends over time. The indicators were used to compare governance performance across the four alternative future scenarios and assess policy implications.

Synthesis of Implications and Drawing of Recommendations

The final analytical step in this theme integrates insights from the scenario analysis, governance indicators and expert consultations to formulate evidence-based policy guidance. By assessing governance trajectories across different futures, this process identifies key areas of risk, resilience and opportunity, ensuring that recommendations are tailored to diverse governance contexts in the Global South. The approach systematically compares governance performance under each scenario, mapping potential interventions and distilling strategic actions that enhance institutional adaptability, foster inclusive governance and mitigate systemic vulnerabilities.

By integrating the above methodology elements, the theme offers a forward-looking analysis linking global trends to governance outcomes. This analysis aims to equip policymakers and stakeholders with insights to help them navigate alternative governance futures.

Historical Overview and Current Governance Context

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• Briefly
• Global South Governance
• Governance Models and Contemporary Trends in the Global South
• Governance Performance

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Briefly

Governance in the Global South has been shaped by a complex interplay of colonial legacies and post-independence challenges, institutional evolution and global economic and political forces. Understanding this trajectory provides a critical context for assessing contemporary governance challenges and anticipating future developments.

Global South Governance

The modern state structures in many Global South countries were primarily influenced by colonial rule, such as parliamentary or presidential systems, which imposed administrative frameworks that often disregarded indigenous governance systems. The post-independence period saw newly formed states grappling with the challenges of nation-building, economic restructuring and institutional development since these structures required significant adaptation to align with diverse domestic political, social and economic conditions. Some states successfully reformed their institutions to enhance political stability and public sector capacity, while others experienced governance challenges, including institutional fragility, political polarisation and difficulty in managing diverse interests. These experiences highlight an essential principle: governance structures must be responsive, inclusive and adaptable to national contexts to ensure long-term effectiveness.

During the Cold War, geopolitical alignments influenced state governance, with many Global South countries caught between competing ideological blocs. This period saw increased foreign intervention, often reinforcing authoritarian regimes or undermining state sovereignty.

Subsequently, the 1980s and 1990s introduced structural adjustment programmes (SAPs) led by international financial institutions, which mandated economic liberalisation and state downsizing. While these reforms aimed to stimulate economic growth, they often weakened state capacity, exacerbated inequalities, and fueled social discontent.

The turn of the 21st Century ushered in an era of globalisation, intensifying state interdependencies. Economic integration, digital transformation and the rise of regional governance structures have redefined the state's role. While globalisation has created new opportunities, it has also exposed states to external shocks, from financial crises to pandemics, highlighting the need for adaptive governance models.

Beyond institutional design, political stability has remained a defining governance challenge. Many states have faced military coups, single-party rule or hybrid governance models that blend democratic institutions with centralised control. Political transitions, contested elections and civic unrest continue to test the resilience of institutions, underscoring the importance of legal frameworks, judicial independence and mechanisms for political accountability. External influences have also shaped governance trajectories, from Cold War-era interventions to contemporary economic partnerships that present both opportunities and governance considerations.

While many states in the Global South share common governance challenges, their trajectories have also been shaped by unique historical, political and economic circumstances. For example, China pursued a state-led economic development model, combining centralised governance with market-oriented reforms to achieve rapid industrialisation and global economic integration. This contrasts with countries in Latin America and Sub-Saharan Africa, where governance has often been influenced by democratic transitions, external financial dependencies and fluctuating political stability.

Similarly, Southeast Asia has seen varied governance models, with states such as Singapore and Vietnam leveraging strong state capacity to drive economic growth. In contrast, others have faced constraints linked to political fragmentation and policy instability. These diverse paths highlight that governance in the Global South is far from monolithic, and understanding these differences is essential in assessing both challenges and opportunities.

As governance structures continue to evolve, states in the Global South face a rapidly changing landscape influenced by globalisation, economic transformation, technology and environmental challenges. Economic governance remains a critical factor in state capacity and institutional resilience. Many states have pursued industrialisation and economic diversification with varying degrees of success, navigating both domestic and global constraints. Key factors such as infrastructure development, access to capital, policy consistency and human capital investment have influenced economic trajectories. While some countries have integrated into global value chains and high-growth sectors, others continue to face structural challenges, including economic volatility, limited diversification and reliance on commodity exports. Demographic trends, including rapid population growth and urbanisation, add further complexity, requiring governments to create employment opportunities, strengthen public services and develop infrastructure that supports sustainable economic development.

Therefore, the evolution of governance in the Global South reflects a continuous process of adaptation, shaped by historical legacies and contemporary global shifts. Political instability, external influences, economic transitions, technological advancements and environmental challenges have all played a role in defining governance trajectories. The central challenge remains the ability of states to build resilient, inclusive and adaptive institutions—ones that can navigate complex political and economic pressures while fostering long-term stability, accountability and development.

Governance Models and Contemporary Trends in the Global South

Governance across the Global South is characterised by diverse models that reflect historical legacies and contemporary adaptations. States vary in their institutional design, ranging from presidential to parliamentary systems, from highly centralised authorities to increasingly decentralised arrangements. Many function in practice as hybrid regimes, combining formal governance structures with informal power dynamics, traditional authorities or customary law. These models often evolve in response to shifting internal needs and external pressures, rather than following a uniform trajectory toward liberal democratic norms.

Ongoing tensions accompany this diversity. On the one hand, states must maintain legitimacy and deliver public goods in contexts marked by limited resources, demographic pressures and contested authority. On the other hand, they must adapt to emerging transnational challenges such as climate change, technological disruption and insecurity. In many cases, legitimacy is grounded less in procedural norms, such as electoral cycles, and more in performance-based measures: the capacity of the state to deliver services, maintain order and foster economic inclusion.

Institutional resilience varies widely across the region. Some states have demonstrated adaptability and innovation in the face of shocks, such as during the COVID-19 pandemic or economic crises, while others struggle with weak institutional capacity and eroding trust. These challenges are compounded by growing demands for accountability and transparency from increasingly vocal citizenries.

Non-state actors are also reshaping the governance landscape. Civil society organisations, traditional leaders, private sector actors and regional institutions play more prominent roles in shaping policy, delivering services and holding governments accountable. This reflects a broader shift toward multilevel and networked governance, where authority is distributed across overlapping systems rather than concentrated solely in central governments. In some contexts, non-state armed actors—such as criminal organisations, gangs, rebel groups and militias— challenge formal governance through less conventional and often coercive means.

Taken together, these trends point to a dynamic and contested governance terrain. While institutional fragmentation remains a risk in some contexts, others show signs of innovation and transformation. This complexity underscores the need for context-specific analysis of governance performance, explored in the following section.

Governance Performance

This section analyses and compares the current context of global state governance through the six World Bank Worldwide Governance Indicators (WGI).  Derived from multiple data sources, including surveys and expert assessments, WGI ensure a broad and balanced representation of governance realities. The indicators align with global development frameworks such as the Sustainable Development Goals (SDGs), particularly Goal 16 to promote peaceful and inclusive societies, reinforcing their relevance for policy formulation. Given the unique governance challenges of many Global South states—such as institutional fragility, external dependencies and informal power structures—WGI serve as a crucial tool for context-specific governance reforms, risk assessments and strategic investment decisions. These six indicators are:

• Voice and Accountability, which can be considered a rough proxy for democracy,
• Political Stability and Absence of Violence/Terrorism (aka Stability),
• Government Effectiveness,
• Regulatory Quality,
• Rule of Law,
• Control of Corruption.

The general picture until 2023 is one of stagnation and regression globally, with a sharp deterioration in stability in the Global North. Chart 1 depicts the WGI for the Global North versus the South. Stability also declines in the Global South, but less sharply. The data reveals a consistent gap between the Global North and South across key governance dimensions. Many regimes in the Global South can be classified as "hybrid regimes” - countries that hold regular elections but do not fully conform to democratic principles. Hybrid regimes are typically more unstable than full autocracies or liberal democracies.

Trends within the Global South are diverse, reflecting the varying historical, political and economic trajectories of different regions. The general trend across the seven groups in the Global South is no change in Control of Corruption, with four regions seeing improvements in Government Effectiveness. Generally, there is a slight improvement in Regulatory Quality and Rule of Law, and no improvement/decline in Voice and Accountability (except for Southeast Asia). Chart 2 shows group averages for the WGI from 1996 to 2023.

A key insight from the data is the disconnect between political participation and governance capacity. While some lower-income regions, such as Sub-Saharan Africa and Latin America, score relatively high on Voice and Accountability, these gains have not translated into stronger governance outcomes as reflected in low scores on Government Effectiveness and Regulatory Quality. This suggests a phenomenon sometimes referred to as premature democratisation in these regions, where political participation expands faster than institutional capacity, contributing to weak institutions, corruption and limited state effectiveness. In a region such as Sub-Saharan Africa, conditional development aid and structural adjustment programmes are some of the drivers of relatively high levels of democracy at low levels of development. In 2025, it raises the question of whether significant reductions in aid by partners such as USAID and the UK could result in a decline in the levels of democracy currently enjoyed in the region.

In contrast, regions with lower democratic participation, such as East Asia and parts of Central Asia, tend to score lower on Voice and Accountability but have demonstrated notable improvements in Government Effectiveness and Regulatory Quality. This indicates that while political freedoms remain constrained, state capacity in these regions has improved, leading to better development outcomes, although accompanied by lower levels of respect for human rights and democracy.

The governance models that have shaped the Global South are now at an inflection point. The historical legacies of colonial administration, structural adjustment programmes and regional governance patterns will continue to influence future state trajectories. However, as global uncertainties mount, governance trajectories will increasingly be determined by a different set of drivers of change. The following section explores these key forces—ranging from technological disruption to demographic shifts—that will shape the governance models of the future.

Horizon Scan

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• Political and Security Governance
• Economic Governance
• Social Governance
• Technology and Innovation
• Climate and Resource Governance

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The following horizon scan outlines the critical drivers and trends shaping the future of state governance in the Global South. Using a systemic lens, it examines interlinked developments across five domains: political and security governance, economic governance, social governance, technology and innovation, and climate and resource governance. Together, these forces reshape how states govern, how authority is exercised and contested, and how states engage with citizens, markets and international systems. The scan aims to illuminate key pressures and possibilities that will influence governance trajectories over the coming decades. These dynamics not only present risks but also open up opportunities to reimagine and redesign governance models in ways that are more inclusive, resilient and tailored to the diverse contexts of the Global South.

Chart 3 illustrates the systemic domains explored in the horizon scan, depicting the interconnected forces shaping the future of state governance in the Global South. It also provides a consolidated list of all factors within each systemic category.

Political and Security Governance

4.1.1 Shifting Geopolitical Power and the Rise of Multipolarity

The global order is undergoing a significant transformation, as the unipolar dominance of the post-Cold War era gives way to a more diffuse and contested landscape. States are increasingly navigating various partnerships, development models and geopolitical alignments. In this context, multipolarity is not simply the redistribution of influence but the reconfiguration of agency, expanding the range of strategic options while also introducing new complexities and risks.

A key driver of this realignment is the erosion of trust in the Western-led order. The Trump administration's aggressive retreat from multilateralism—via aid cuts, tariff wars and transactional diplomacy—is a leading example exposing the fragility of long-standing alliances and intensified uncertainty. Although felt globally, many states in the Global South were especially affected due to their historical reliance on Western-led financing and trade relationships. As a result, longstanding questions about the reliability of traditional alliances and economic frameworks have resurfaced with greater urgency, prompting states to accelerate or deepen efforts to reassess their development and security strategies in an increasingly unpredictable global environment.

This evolving landscape is not driven by abstract shifts alone; it is being actively reshaped by ambitious initiatives from emerging powers. Chief among them is China’s Belt and Road Initiative (BRI), which exemplifies how infrastructure can serve as a vehicle for geopolitical influence. It operates as a grand strategic lever: redrawing trade routes, embedding Chinese standards and expanding diplomatic influence across more than 140 countries. The proliferation of large-scale projects—often opaque, debt-financed and strategically located—poses difficult questions for states trying to balance developmental needs with long-term sovereignty.

Alongside China’s bilateral efforts, a broader rebalancing is taking place through co

alitions that are positioning themselves as alternative centres of global decision-making and financial governance. The recent expansion of BRICS (Brazil, Russia, India, China and South Africa) to include Saudi Arabia, Egypt, Argentina, the United Arab Emirates, Iran and Ethiopia further signals the rising weight of non-Western blocs in global decision-making. The New Development Bank (NDB), initially founded by the five BRICS nations, has likewise grown its membership. Although full-scale de-dollarisation or the advent of a digital BRICS currency remains unlikely in the near term, both China and Russia have signalled strong interest in forging an alternative financial system outside the US dollar’s dominance. If these efforts mature, they could blunt the force of dollar-based sanctions and increase the appeal of alternative monetary regimes, particularly for heavily indebted countries in the Global South.

Regional frameworks like AfCFTA and ASEAN offer promising platforms for building collective agency and reducing vulnerability to great-power competition. AfCFTA, for instance, could boost intra-African trade by over 45% by 2045, if long-standing implementation hurdles can be overcome. Similarly, ASEAN’s emerging digital governance frameworks, including coordinated efforts on data, cybersecurity and e-commerce, illustrate how regional cooperation can enhance sovereignty in critical technological sectors. Still, the success of these mechanisms depends on the ability of member states to reconcile divergent political systems, economic priorities and levels of institutional capacity.

The intensifying multipolarity in the Global South is not confined to economic or diplomatic arenas. It is increasingly shaped by complex security dynamics, particularly in strategically contested maritime spaces. Along the Red Sea and Indian Ocean, littoral states (countries bordering these waters, such as Djibouti, Sudan and Kenya) face growing challenges as military competition escalates. The Houthi missile and drone attacks on commercial shipping have prompted retaliatory naval interventions, including the US-led Operation Prosperity Guardian, a multinational coalition established in December 2023 to ensure freedom of navigation and regional security. Despite the coalition's efforts, Houthi attacks have persisted, leading to significant disruptions in maritime traffic. Reports indicate that the Houthis have adapted their tactics, utilizing low-cost, high-impact weapons that strain the defensive systems of their adversaries. These tensions intersect with China's Belt and Road Initiative (BRI), which has financed dual-use infrastructure such as the Djibouti port and logistical hubs in Kenya, and the expansion of BRICS to include Egypt, Ethiopia and Saudi Arabia (countries with direct stakes in Red Sea security).

Meanwhile, in the South China Sea, disputes involving China, Vietnam and the Philippines have intensified, with militarised maritime confrontations and coercive strategies eroding regional stability. These developments expose how military competition is entangled with economic multipolarity, amplifying governance challenges for states caught between great power rivalries. Diversifying resources into military build-ups, securitisation of state functions and heightened external alignment pressures risk weakening domestic institutions, eroding social contracts and undermining inclusive governance across the Global South.

Faced with this increasingly complex terrain, many states are adopting hedging strategies, balancing rival powers in an attempt to preserve autonomy and extract value from competing spheres of influence. For instance, Vietnam courts both China and the US, and Kenya has renegotiated Chinese-financed infrastructure projects under public pressure, whilst simultaneously engaging with the US on a bilateral trade agreement. These are often cited as cases of successful strategic autonomy. However, such manoeuvres demand high levels of institutional coherence, policy agility and political consensus. Absent these, hedging can devolve into policy drift, elite capture or renewed forms of clientelism under new banners.

Debt remains a key instrument of influence. Although Chinese lending has slowed since 2020, the aftershocks of earlier loans continue to shape fiscal trajectories. Sri Lanka’s 2017 signature of a 99-year lease agreement with China for the Hambantota Port is a cautionary tale in this regard. Zambia’s protracted restructuring of its US$17 billion debt shows the complexity of managing diverse creditors, including China, multilateral banks and private bondholders. These are not uniquely Chinese dilemmas: any poorly structured borrowing, regardless of source, can either unlock development or compromise sovereignty, depending on the transparency, competence and strategic foresight of borrower governments.

Some states assert control through economic policy, reviving protectionist tools to shield domestic industries and reduce exposure to volatile global markets. Indonesia’s ban on unprocessed nickel exports and India’s “Atmanirbhar Bharat” strategy reflect a broader trend toward economic nationalism. These measures aim to build domestic capacity and increase resilience, but they also risk disrupting supply chains, triggering retaliation and undermining regional cooperation.

Yet, the rise of multipolarity is not confined to interstate competition. Increasingly, power is being wielded by actors outside the formal state system, especially multinational tech firms, whose influence over critical infrastructure rivals that of governments. Firms like Amazon, Tencent, Meta and Huawei influence commerce, speech, data flows and even public infrastructure. Their platforms often outpace national regulation, leaving states scrambling to assert control over digital spaces. This shift represents a direct challenge to traditional state authority, particularly in regions with limited regulatory capacity.

The next decade will test whether multipolarity enables a more equitable and pluralistic international order or merely recasts old hierarchies in a new form. What emerges will depend less on structural shifts than on the strength, agility and foresight of state institutions facing a world in flux.

Critical considerations for state governance in the future: How might multipolarity reshape the balance between state sovereignty and external influence in the Global South? How can Global South states leverage regional alliances to strengthen governance and resilience? What governance frameworks or mechanisms could be necessary to manage the growing political influence of multinational corporations and big tech, ensuring alignment with national interests and development goals? As traditional Western-led institutions evolve or decline, how can Global South states proactively shape new global governance structures to reflect their priorities and values better?

 

4.1.2 Democracy Under Pressure

The global average of democratic rights and freedoms has regressed to levels last seen in the 1980s, with over a third of the world’s population now living under authoritarian rule. This shift is reshaping governance worldwide, especially in the Global South, where many states are navigating a fragile space between autocracy and liberal democracy. These developments are prompting a deeper examination of how democratic systems function in practice and what they can realistically deliver. Chart 4 depicts the global democracy index (by Varieties of Democracy Project) from 1994 to 2024.

Since the Industrial Revolution, core countries of the Global North have defined dominant models of development and governance, first through imperialism and colonialism, later through globalisation. As these states became wealthy and democratic, they exported their institutional frameworks and political ideals through influence or imposition. In doing so, they embedded the belief that liberal democracy is the ultimate outcome of development and a key enabler of accountable governance, particularly across the Global South and within the international development agenda.

While democracy is often assumed to lead to good governance, history shows it does not guarantee it. The advance of democracy in Latin America and the Caribbean, Sub-Saharan Africa and South Asia has not delivered on the promise of development or equity. These regions have achieved relatively high democratic scores, yet remain among the most unequal in the world. Meanwhile, authoritarian regimes in East Asia and the Gulf have significantly improved infrastructure, income and basic services. This divergence has seriously undercut the once-dominant assumption that democracy and development naturally go hand in hand.

In much of the Global South, formal democratic structures have often failed to overcome deeply entrenched inequalities and vested interests. Many transitions stall in hybrid regimes, where elections coexist with patronage politics, elite control of media and resources and limited civic agency. These systems are often vulnerable to both internal disruptions (such as citizen protests or economic shocks) and external interference, particularly when governance is weak or extractive institutions remain intact. Despite this, demand for accountable governance remains strong, which is evident in anti-corruption campaigns, social justice protests and calls for transparency across Africa, Asia and Latin America.

The challenge is not a lack of democratic aspiration, but the absence of political structures capable of delivering on those aspirations in equitable, durable and inclusive ways.

The pressures on democracy are increasingly shaping public policy. A resurgence of nationalism and a renewed focus on national identity drive shifts toward stricter immigration controls and the reassertion of state sovereignty. Across Europe, the Americas and Asia, political parties are harnessing public anxieties over economic insecurity, cultural change and perceived threats to national cohesion. Many deploy rhetoric that challenges progressive norms on diversity, gender and identity, often framed as resistance to so-called “woke” politics. This polarisation influences legislative agendas, weakening institutional safeguards and eroding democratic consensus. Crucially, this climate has triggered a growing backlash against rights defenders like journalists, activists and civil society leaders who now face escalating harassment, surveillance and criminalisation.

This disconnect is unfolding amid what many describe as a global democratic recession. The "rise of the rest" has coincided with the erosion of democratic norms, not only in emerging powers but within the Global North itself. Elections worldwide have exposed profound voter disillusionment and fractured mandates. Populist parties on both the left and right are entering the mainstream, attacking elites, undermining institutions and deepening societal division.

Critical considerations for state governance in the future: Will disillusionment with democracy grow, or will it overcome challenges and regain dominance? How will increasing political polarisation and populism affect state capacity and legitimacy in the Global South? In what ways could rising authoritarian trends influence governance effectiveness, citizen participation and policymaking in developing countries? How can states in the Global South manage societal divisions driven by nationalism and populism while maintaining democratic institutions and governance stability?

 

4.1.3 Security and Conflict Dynamics

Over the past five years, the number of conflict events worldwide has almost doubled, marking a stark escalation in global insecurity. Chart 5 presents the global number of armed conflicts from 1989 to 2023. This surge reflects both the eruption of new large-scale wars and the intensification of protracted crises. High-impact conflicts in Ukraine, Gaza and Myanmar have driven much of the recent violence, while entrenched instability in places like Sudan, Mexico, Yemen and across the Sahel continues unabated.

 

State-Based Conflict

According to the Uppsala Conflict Data Program (UCDP), 2023 recorded 59 state-based conflicts in 34 countries, the highest number since 1946. This marks a significant reversal of the post-Cold War decline in armed conflict. For the past eight consecutive years, more than 50 such conflicts have occurred annually, signalling a sustained and systemic deterioration in global peace and security. Chart 6 shows the number of state-based armed conflicts by region from 1946 to 2023.

Nowhere is this more evident than in the Global South. Africa has seen its number of state-based conflicts nearly double in the past decade, from 15 in 2013 to 28 in 2023. Countries such as Sudan, Ethiopia, Mali and Burkina Faso continue to face armed uprisings, often intensified by jihadist groups and political fragmentation. Meanwhile, the Middle East, previously on a downward trajectory, has seen a resurgence, most notably in the deadly Israel-Palestine war, which caused over 23 000 fatalities in just three months.

These conflicts increasingly occur in middle-income and partially democratic states, challenging the long-held assumption that economic development and electoral democratisation naturally lead to stability. Without inclusive, accountable governance, these states often become flashpoints for grievances, competition and violent contestation.

States as Perpetrators of Violence

The governance crisis deepens when the state is not merely unable to protect its citizens, but is itself a source of violence. In 2023, over 10 200 civilian deaths were attributed to one-sided violence, with more than 2 000 caused by state actors. While slightly lower than recent peaks, state-perpetrated violence remains a disturbing trend. In countries such as Myanmar, Syria, Sudan and Russia (in Ukraine), government forces have been implicated in widespread human rights abuses, often targeting civilians directly.

This shift, where states actively undermine their protective role, profoundly erodes the social contract, intensifies societal division and complicates peacebuilding efforts. It also exposes a structural weakness in global governance: the lack of effective accountability mechanisms when sovereign states violate the rights of their own populations.

Rise of Non-State Actors

Alongside these developments, non-state conflicts have surged and stabilised at historically high levels. In 2023, 75 non-state conflicts were recorded, mostly involving criminal organisations, terrorist groups or militias. The UCDP classifies these actors into:

• Formally organised groups, with identifiable names and structures;
• Informal political groups, such as party-affiliated mobs; and
• Communal groups, rooted in ethnic, religious or tribal identity.

Organised groups primarily drive the rise in non-state violence, while communal conflicts have also grown steadily. Conflicts involving informal political groups remain relatively rare. Chart 7 presents the number of non-state conflicts by region from 1989 to 2023.

Regional patterns vary significantly. Notably, the Americas surpassed Africa for the first time, becoming the region with the highest number of non-state conflicts, driven by violence linked to powerful drug cartels in Mexico and Brazil. Mexico alone accounted for nearly 14 000 battle-related deaths in 2023, underscoring the severity and complexity of non-state violence in the region. In contrast, Africa has seen a notable decline in non-state conflicts over the past six years, despite historically being the most affected region.

While both Africa and the Americas have recorded high numbers of non-state conflicts, the nature of these conflicts differs considerably. In the Americas, violence is primarily driven by highly structured and well-armed groups such as organised crime syndicates and drug cartels. In Africa, non-state violence more often stems from communal conflicts, rooted in ethnic, religious or local identity divisions. Meanwhile, the Middle East, which saw a significant rise in non-state conflicts during the 2010s, has experienced a sharp downturn in such incidents in recent years.

By contrast, Europe and Asia continue to experience relatively low levels of non-state conflict, both in terms of frequency and intensity. This regional variation highlights the importance of context-specific approaches to understanding and addressing non-state violence across the Global South.

The evolving nature of conflict presents a fundamental challenge to state governance in the Global South. As conflicts become more fragmented, involving multiple actors and overlapping grievances, states must navigate a complex security environment where they are both responders to and, at times, instigators of violence. Reclaiming legitimacy will require not only restoring civilian trust and accountability but also adopting flexible, inclusive and context-specific approaches to security governance. Strengthening institutions, ensuring human rights protections and confronting the structural roots of violence are essential for moving from crisis response to long-term stability.

Critical considerations for state governance in the future: How can states enhance security measures without undermining democratic institutions, public trust and minority protections? How can states prepare for the growing role of non-state actors? What governance adaptations are required to respond to emerging threats such as cyber-attacks, misinformation and digital espionage? How might the fragmentation of global security governance affect the ability of states in the Global South to address security challenges collaboratively?

 

4.1.4 Localised Governance

Localised governance is emerging as a frontline issue in the reconfiguration of state legitimacy across the Global South. Often described in terms of decentralisation, it is more than a technical redistribution of powers; it is a profoundly political process that redefines who governs, where and how. It determines whether state authority feels accessible or remote, whether services are delivered equitably and whether diverse communities see themselves reflected in national institutions.

This trend is not driven by policy preference alone but by mounting systemic pressures. Rapid urbanisation has stretched megacities like Lagos, Dhaka and Mumbai to their limits, forcing subnational authorities to take on more governance responsibilities, often without corresponding authority or resources. Simultaneously, localised governance is being propelled from below as Indigenous movements, grassroots organisations and informal authorities demand greater recognition and autonomy. In many cases, governance is not devolved by design but delegated out of necessity.

In fragile or rural contexts, informal and traditional institutions often act as the default governance systems. In countries like Nigeria, Somalia and Afghanistan, tribal courts, clan elders and customary authorities regularly mediate justice and manage community affairs, particularly in areas where formal institutions lack legitimacy or reach. Traditional leaders are often viewed as more trustworthy than elected officials or police forces, especially in rural areas. These dynamics are not relics of the past; they are operational, embedded forms of local governance, though their effectiveness varies across contexts.

Around the world, decentralisation efforts that build on such culturally grounded systems tend to generate more durable legitimacy. In Bali, the subak system, a centuries-old, community-managed irrigation model, has been formally integrated into environmental governance, aligning spiritual, ecological and institutional logics. In Brazil’s Amazon, Indigenous communities now co-manage forests with federal agencies, blending traditional environmental knowledge with satellite monitoring technologies. Similarly, in Colombia, the formal recognition of Indigenous Cabildos has empowered communities to act as official local governments with administrative powers and public budgets, enhancing both environmental stewardship and cultural identity. In Mexico’s Ixtlán de Juárez, Indigenous-led forest management has transformed local economies and ecosystems, reducing poverty and ecological degradation through collective governance. Across Africa, Indigenous knowledge systems, including pastoralist conflict resolution and resource management, continue to shape local governance, offering adaptive and resilient models rooted in generations of ecological understanding.

While outside the Global South in this theme, Australia offers a telling case of the challenges surrounding formal Indigenous inclusion. In October 2023, a national referendum to enshrine an Aboriginal and Torres Strait Islander Voice to Parliament was defeated, revealing deep societal divisions over Indigenous participation in governance. This underscores a broader truth: genuine Indigenous engagement requires more than symbolic recognition; it demands structural reform, political will and durable institutions rooted in Indigenous knowledge systems.

Participatory budgeting, pioneered in Porto Alegre, Brazil, has been adopted in cities like Buenos Aires and Jakarta, enabling citizens to influence budget allocations directly. While these initiatives create new avenues for transparency and inclusion, in low-capacity settings, they can reinforce centralisation, especially when local authorities lack the legal or technical leverage to control digital platforms or safeguard citizen data. In such cases, digital governance risks becoming a new form of top-down control rather than a driver of local empowerment.

The trajectory of local governance will significantly shape state legitimacy, cohesion and institutional resilience in the Global South. However, the outcomes of decentralisation remain uneven. Where reforms are limited to symbolic gestures, without absolute autonomy, resources or accountability, they risk reinforcing inequality and public distrust. Where supported by political commitment and institutional capacity, decentralisation can enable more locally grounded responses to governance challenges. Looking ahead, a key uncertainty is whether these evolving models will lead to genuine power-sharing or reconfigure centralised control through more fragmented or technologically mediated forms.

Ultimately, legitimacy and trust in state institutions are deeply intertwined with the effectiveness of local governance. When communities see their values, knowledge systems and leadership reflected in governance structures, trust is strengthened and legitimacy is reinforced. Recognising and integrating Indigenous governance models not only honours cultural heritage but also builds more resilient and inclusive states.

Critical considerations for state governance in the future: Will decentralised governance models empower local decision-making, or will they deepen fragmentation and reinforce central control? Can states integrate Indigenous knowledge into governance mechanisms, or will tensions arise between traditional systems and formal state structures? How might private sector actors and development agencies shape local governance models?

 

Economic Governance

4.2.1 Southern Shift: Emerging Markets, Expanding Influence

The centre of global economic gravity is shifting, measurably and irreversibly, from the industrialised North to the emerging South. Over the past two decades, much of global GDP growth has come not from Europe or North America, but from Asia, Africa and Latin America. By 2040, more than half of global GDP is expected to be generated by countries currently classified as “emerging markets,” with Asia alone accounting for over 40%. This is not merely a geopolitical transition; it is an economic realignment that is reshaping the foundations of global development. Chart 8 illustrates the global economy in 2050.

At the heart of this transformation is the rise of new middle classes across the Global South, particularly in Asia. In 2020, over two billion people in Asia-Pacific were classified as middle-income; a number projected to reach 3.5 billion by 2030. In Africa, a demographic surge is fueling similar momentum: with over 70% of the population under 30, the continent is becoming a hub of urbanisation, innovation and rising demands. Cities like Lagos, Nairobi and Accra are emerging as consumption engines and economic dynamism.

India, now the world’s most populous country, is on track to become the third-largest economy by the end of the decade. Its growing domestic market, digital infrastructure and demographic edge position it as a global engine of demand and innovation. China, despite facing population decline, remains an economic heavyweight, driving investment, production and capital flows across the Global South. Together, these regions are not just catching up; they are becoming the global marketplace of the future.

With this demographic and economic growth comes bargaining power. The Global South is no longer just a supplier of raw materials or low-cost labour. It is a fast-growing consumer base capable of shaping production standards, influencing trade flows and setting norms around technology, sustainability and labour. As consumption patterns shift towards meat, mobility, digital goods and higher energy use, so too do expectations around regulation, climate governance and social protections. States that can effectively represent and align these interests at the global level will play a pivotal role in redesigning 21st-century markets.

But growth brings pressure. Expanding middle classes increase demand for water, food, energy and housing, amplifying resource constraints and environmental risk. Without adequate urban planning, infrastructure investment and sustainability strategies, states risk being overwhelmed by congestion, pollution and inequality. Informality remains high in many economies, limiting tax capacity and social insurance coverage. Rising aspirations must be matched by institutional capability, or they may become political volatility.

Meanwhile, the global production map is also shifting. Countries like Vietnam, Bangladesh, Mexico and Ethiopia are becoming competitive alternatives to China in manufacturing and logistics. However, to sustain this advantage, states must go beyond low wages; they must invest in labour standards, digital connectivity, logistics systems and green compliance.

As Global South economies gain weight, regional integration and South-South cooperation will become even more essential tools of strategic leverage. By coordinating policy, pooling resources and negotiating as blocs, states can amplify their influence in global rule-setting, from trade and digital governance to climate finance and debt negotiations. The ability to shape, not just absorb, global markets will depend on how well emerging economies build coalitions, institutional resilience and common developmental agendas across regions.

Critical considerations for state governance in the future: As Global South economies become global growth engines, could states transition from rule-takers to rule-makers in shaping global economic norms and standards? Might the economic rise of the Global South lead to a reimagining of the state as a negotiator of markets and ecosystems, rather than just a regulator? Could new forms of regional or digital sovereignty emerge, with states pooling authority to influence global systems they cannot individually control?

 

4.2.2 Growth and Demographics: A Governance Dividend or Liability?

Economic development will be a defining force shaping governance futures in the Global South, especially where it intersects with rapid demographic transformation. Chart 9 presents the GDP growth rate forecast by region from 2025 to 2050. Over the next 25 years, the Global South is expected to be the primary engine of global economic growth. Yet, this growth will be uneven, and its developmental impact is far from guaranteed. What matters is not how fast economies grow, but how well that growth is governed through inclusive institutions, accountable public investment and forward-looking policy choices.

Chart 9 shows that South Asia and Sub-Saharan Africa are forecast to record the highest GDP growth rates globally between 2025 and 2050. This is primarily driven by their youthful populations and expanding labour forces. However, this headline growth risks being misleading. Without strong economic governance, including capable institutions, inclusive fiscal policy and long-term investment strategies, rapid growth may exacerbate inequality, strain public services and deepen instability.

By contrast, the Global North is approaching the end of its demographic dividend, with ageing populations slowing workforce growth. Average annual GDP growth is projected at just 1.6%. In these regions, maintaining economic performance will depend on governance that promotes innovation, automation and capital investment to offset labour shortages.

Chart 10 depicts the development of GDP per capita by region from 1960 to 2050. It reveals a stark disconnect: despite high projected growth, Sub-Saharan Africa and South Asia remain at the bottom in terms of GDP per capita, lagging far behind the Global North. Sub-Saharan Africa’s average income level is forecast to stay under 10% of the Global North’s by 2050. This points to a deeper development gap, one that will not be closed by growth alone. Structural deficits in governance, from weak revenue mobilisation to limited policy coherence, continue to constrain the region’s capacity to convert growth into prosperity.

In contrast, East Asia offers a gostory of vernance success sIts manufacturing-led growth, underpinned by active state intervention, has translated into major gains in GDP per capita. By 2050, East Asia’s income levels are projected to reach nearly half those of the Global North; a remarkable convergence by Global South standards.

For the Global South, the coming decades will be defined not just by how fast economies grow but also by how well states manage that growth through inclusive, accountable and forward-looking governance systems.

Demographic Transitions

A demographic dividend refers to the potential economic boost that arises when a country’s working-age population grows larger relative to its dependents (children and the elderly). This period, when most people are economically active, enables governments to shift resources from basic services like schooling and childcare toward investments that fuel economic growth.

A widely accepted measure of this opportunity is the ratio of working-age individuals (aged 15–64) to dependents. When this ratio reaches around 1.7 to one, a country typically enters its first demographic dividend phase. Yet, this numeric threshold is only part of the story. Realising the full potential of a demographic dividend depends crucially on a state’s ability to provide high-quality education, accessible healthcare and robust employment opportunities.

Chart 11 maps the demographic dividend timelines across major regions in the Global South from 1960 to 2050. It shows that East Asia is currently at the peak of its demographic window, benefiting from a high ratio of working-age individuals. However, this window is closing rapidly; it is projected to exit the dividend period by the early 2040s—a shift that will be reflected in declining economic growth rates.

In the Middle East and North Africa, a favourable age structure has not yet translated into significant economic gains. Political and institutional constraints, ranging from rigid labour markets to state-dominated economic frameworks and persistent challenges in gender equity and education quality, continue to hamper progress.

Sub-Saharan Africa remains in a pre-dividend stage. With the youngest population globally, only five countries in the region (Mauritius, Cabo Verde, Seychelles, South Africa and Botswana) have entered a demographic dividend window. In many other nations, the persistently high dependency ratio, where children and the elderly far outnumber the working-age population, has slowed economic growth. This imbalance places tremendous pressure on public resources, as governments must allocate a significant share of their budgets to fundamental services like healthcare and education rather than investing in growth-enhancing sectors. While these challenges have constrained productivity and limited labour force participation, they also underscore the region’s tremendous future potential. If Sub-Saharan African countries can build robust governance frameworks to better manage this transition, they stand to unlock significant long-term economic and social dividends.

Demographics set the stage, governance writes the story

A large working-age population is not a dividend by default. Without the right conditions like jobs, education, healthcare and public investment, the demographic shift can lead to economic stagnation, rising inequality and social unrest.

Governments must play an enabling role, particularly in:

• Expanding access to quality education and vocational skills,
• Creating inclusive labour markets that absorb young workers,
• Facilitating urban development to support growing populations, and
• Maintaining macroeconomic and political stability.

These goals are often the hardest to achieve in fragile or highly unequal contexts. If left unaddressed, the demographic dividend can quickly turn into a demographic liability, placing unsustainable strain on public systems and increasing vulnerability to instability.

Ultimately, the demographic dividend is a governance opportunity. Countries that anticipate the shift and plan accordingly can unlock significant improvements in economic performance and human development. Others may miss the window, or worse, face the destabilising consequences of inaction.

Critical considerations for state governance in the future: Could the future state be defined less by its growth rate and more by its ability to convert demographic shifts into broad-based opportunity? How might the failure to manage youthful populations and growing expectations reshape the state's role, from development engine to conflict manager? As demographic dividends close in some regions and open in others, might states' legitimacy hinge on their ability to adapt in real time, redistributing resources and redesigning institutions to meet shifting population needs?

 

4.2.3 The Emerging Global Debt Crisis

The global debt crisis is not merely an economic problem; it is a structural threat to the fiscal sovereignty, developmental capacity and political legitimacy of states in the Global South.

Chart 12 illustrates global public debt from 2010 to 2024. In 2023, global public debt soared to a record US$97 trillion, with over 40% of the world’s population living in countries where interest payments consume more funds than investments in education or health. Although developing countries account for just under one-third of this debt, around US$29 trillion, their borrowing has grown at twice the pace of that in developed economies since 2010.

Low- and middle-income countries (LMICs) are at the heart of this crisis. In 2023, LMICs outside China spent about US$971 billion on debt servicing, double the amount from a decade ago, with interest payments rising by 33% to US$406 billion. The poorest nations have faced even steeper increases, with interest costs quadrupling to US$34.6 billion since 2013. These pressures stem from pandemic-induced borrowing, soaring global interest rates, currency devaluations and escalating climate adaptation costs.

A significant factor exacerbating these issues is the structure of external debt. Over half of the long-term debt owed by LMICs (excluding China) and 40% of the debt in the poorest nations is linked to variable interest rates that mirror the high rates in the Global North. In addition, more than 80% of LMIC debt is denominated in US dollars, increasing costs further as the dollar strengthens. As governments are forced to spend more on debt servicing, they have less available to invest in essential infrastructure, healthcare and long-term development—actions that stifle economic growth and erode public trust.

Compounding external pressures is the persistent challenge of domestic revenue mobilisation. Many Global South countries struggle with weak tax systems, large informal sectors and political resistance to progressive taxation. Corruption, widespread tax avoidance and exploitable loopholes further reduce fiscal resources, forcing these governments to rely on expensive and often restrictive external financing. This fiscal fragility not only limits policy options but also exposes states to external geopolitical pressures.

The stakes are high. As debt servicing increasingly crowds out vital investments in public goods, countries risk falling into a vicious cycle of stagnation, widening inequality and institutional decay. Addressing these challenges will require a dual approach: overhauling domestic revenue systems to build fiscal resilience and exploring alternative financing mechanisms that protect transparency and accountability.

Reclaiming fiscal sovereignty is increasingly recognised as a foundational condition for sustainable governance. Addressing this challenge will require a two-pronged approach. First, domestic revenue systems should be strengthened to improve equity, effectiveness and resilience. This includes broadening the tax base, addressing weaknesses in tax administration, enhancing compliance and tackling illicit financial flows. Ensuring fair taxation, both across income groups and economic sectors, remains central to restoring state legitimacy and funding long-term development goals. Second, financing mechanisms should be diversified to reduce over-reliance on external debt and expand access to development finance on terms that safeguard national autonomy. This involves rethinking the architecture of public borrowing, exploring instruments such as sovereign wealth funds, climate-related finance, diaspora bonds and regional development pools, while ensuring transparency and public accountability in all financing strategies.

Critical considerations for state governance in the future: How might soaring debt levels reshape governmental priorities and institutional structures? Which alternative financing options or partnerships could strengthen governance models without undermining transparency or accountability?

 

4.2.4 Economic Sovereignty in a Fragmenting Trade Order

The Global South has long navigated a trading system shaped by post-World War II institutions like the WTO, IMF and World Bank. While economic liberalisation has benefited some, it often constrained the policy space of developing nations, locking many into roles as raw material exporters with limited access to technology or value-added markets.

In response, regional trade alliances are gaining momentum. Initiatives like the African Continental Free Trade Area (AfCFTA), the Regional Comprehensive Economic Partnership (RCEP) and Latin America's MERCOSUR aim to strengthen intra-regional trade, harmonise regulations and reduce dependence on external actors. These frameworks offer pathways toward economic coordination, but their success hinges on overcoming internal fragmentation and aligning national interests.

Meanwhile, global trade patterns are undergoing a fundamental shift. The rise of “friendshoring” (the reconfiguration of supply chains to favour politically aligned or strategically located partners) is creating new winners and losers in the Global South. Countries like Vietnam and Mexico have emerged as key beneficiaries, offering geopolitical alignment, cost-competitive manufacturing and trade proximity to major markets (e.g., the US and East Asia). Others, particularly in sub-Saharan Africa, Central Asia and smaller island economies, risk marginalisation due to infrastructure gaps, perceived instability or lack of integration into global production networks.

As both a major trading partner and geopolitical rival to the West, China is central to Global South economies, providing investment, market access and alternative financing through initiatives like the Belt and Road. Yet, efforts by Western powers to “de-risk” from China are reshaping where capital flows and factories land, adding a layer of strategic tension for states caught between major powers.

Legal frameworks like Investor-State Dispute Settlement (ISDS) continue to challenge national sovereignty, allowing corporations to sue governments over public-interest regulations. At the same time, new trade frontiers such as digital services, environmental standards and carbon border taxes risk entrenching old inequalities in new ways. Looking ahead, economic sovereignty will be a contested and strategic domain. The choices states make today—about alliances, industrial policy and negotiation leverage—will shape their ability to govern effectively in a world of fractured globalisation.

Critical considerations for state governance in the future: How will emerging regional blocs reshape the capacity of states to pursue independent industrial and development strategies? Can Global South governments maintain policy sovereignty while competing for foreign investment in a fragmented global economy? How must state institutions evolve to navigate new trade frontiers—such as digital economies, green standards and shifting geopolitical alliances?

 

Social Governance

4.3.1 Rapid Population Growth and Rising Pressures

State governance is inextricably linked to demographic dynamics. The size and age structure of a population shape the breadth and urgency of state responsibilities; whether it is building schools, expanding healthcare systems or managing urbanisation.

Chart 13 depicts population development by region from 1960 to 2050. It highlights the extraordinary pace of population growth in Sub-Saharan Africa. In 2020, its population, at 1.15 billion, was on par with the Global North. By 2050, it is projected to double, reaching 2.3 billion and matching South Asia. This expansion spans a highly diverse group of 48 countries, led by Nigeria, Ethiopia and the DR Congo in absolute numbers. All other countries in the group have much smaller populations, although many are growing rapidly. For example, populations in the DR Congo, Chad, Niger, Equatorial Guinea, Mauritania, Angola, Somalia and Uganda are growing at more than 3% per annum.

With an average growth rate of 2.3% per year from 2025 to 2050, Sub-Saharan Africa stands apart from regions like East Asia and the Global North, where populations are set to decline. South Asia, led by India, has substantial population growth but shows signs of slowing towards mid-century, maintaining considerable pressures on governance systems. Latin America and MENA, by contrast, are approaching demographic plateaus, but even minimal increases risk straining already fragile and unequal governance structures.

For governments across the Global South, the challenge is not just managing numbers; it is about expanding state capacity fast enough to meet rising demands for housing, education, healthcare and jobs. How effectively states respond will play a defining role in shaping the region’s development path.

Critical considerations for state governance in the future: Could the scale and speed of population growth in the Global South force a reconfiguration of the state, away from centralised planning toward decentralised, adaptive service delivery models? How might governance legitimacy evolve if states can no longer meet basic service demands through traditional bureaucratic approaches? Could future states in high-growth contexts operate more like platform states, enabling service delivery through networks of public, private and informal actors?

 

4.3.2 Urbanisation and Mega-Cities

Urbanisation is reshaping the world, with more than half of the global population now living in cities and towns. By 2050, nearly 70% of people are projected to reside in urban areas, with Asia and Sub-Saharan Africa contributing to around 90% of this growth. Chart 14 shows urban population growth in more or less developed regions from 1960 to 2050.

The number of cities with populations exceeding 10 million, known as megacities, is also expected to rise, increasing from 33 in 2018 to 43 by 2030, with all new additions occurring in the Global South. Chart 15 depicts the average annual rate of change in city population size from 2020 to 2035.

Some of the challenges to governance include:

• The swift expansion of urban populations often outpaces the development of essential infrastructure and services, leading to inadequate housing, transportation and sanitation. This strain challenges local governments to provide for their citizens effectively. ​
• A significant portion of urban dwellers reside in informal settlements without secure tenure or access to basic services. The proliferation of these areas complicates urban planning and governance, necessitating inclusive policies that address the needs of all residents.
• Megacities contribute substantially to carbon emissions and face heightened risks from climate change-related disasters. Governance structures must integrate environmental considerations into urban planning to mitigate these impacts. ​

The complexity of managing megacities has prompted many countries to decentralise authority, empowering local governments to make decisions tailored to their unique contexts. This shift can lead to more responsive and effective governance.​ Engaging citizens in planning and decision-making processes fosters transparency and ensures that urban development aligns with the needs of the population. Initiatives like participatory budgeting have been successfully implemented in various cities to involve residents directly.​ Projects like Tatu City in Kenya exemplify new approaches to urban development, aiming to create well-planned, sustainable urban spaces that address common challenges associated with rapid urbanisation. ​

Addressing the multifaceted challenges posed by rapid urbanisation and the rise of megacities requires adaptive governance structures that prioritise inclusivity, sustainability and resilience. By embracing innovative approaches and fostering collaborative partnerships, cities in the Global South can navigate the complexities of urban growth and enhance the well-being of their inhabitants. Mega-cities act as economic engines yet simultaneously strain infrastructure, exacerbate inequalities and generate complex socio-political challenges. Effective urban governance will increasingly define state legitimacy and capability, requiring states to adopt innovative governance models, invest in sustainable infrastructure and address urban inequalities proactively.

Critical considerations for state governance in the future: How will the rise of powerful urban governments influence the balance of power between national and local governance? How must governance adapt to ensure the sustainability and resilience of megacities in the Global South? Does metropolitan governance improve growth and poverty reduction?

 

4.3.3 Forced Displacement and Migration

The global displacement crisis has reached historic levels, posing one of the most urgent and complex governance challenges of the 21st Century. Chart 16 illustrates forcibly displaced people globally from 2014 to 2024. By the end of 2023, an estimated 117.3 million people were forcibly displaced due to conflict, persecution, human rights violations or events that severely disrupted public order. This marks an 8% increase from the previous year and continues a 12-year trend of year-on-year growth. Early 2024 estimates suggest the number may already have exceeded 120 million.

Displacement remains heavily concentrated in the Global South. Three-quarters of forcibly displaced people are hosted in low- and middle-income countries, and 69% remain in neighbouring countries, placing immense strain on host states with limited financial and institutional capacity. In smaller countries like Lebanon and Aruba, displaced populations make up as much as one-fifth of the total population, reshaping demographics and stretching basic services.

Climate change is rapidly compounding this crisis. By the end of 2023, nearly 75% of displaced people were living in countries with high or extreme climate-related risks, such as droughts, floods or extreme heat. Nearly half lived in countries exposed to both climate hazards and ongoing conflict. These converging pressures, particularly in countries like Sudan, Somalia and the DR Congo, are destabilising livelihoods, fuelling local tensions and weakening governance systems, especially in already fragile regions.

Internal displacement continues to rise sharply. In 2023 alone, there were 13.7 million new instances of people being forced to flee their homes due to violence, without crossing borders. This brought the total number of internally displaced people (IDPs) to 63.3 million by year’s end. The majority of new displacements occurred in just five countries, including Sudan, DR Congo and Syria. While some eventually return home, the number of people able to do so dropped significantly, with only 5.1 million returns reported, 39% fewer than in the previous year.

Statelessness compounds displacement. At the end of 2023, at least 4.4 million people lacked legal nationality. Some, like the Rohingya, are both stateless and forcibly displaced. Without recognised citizenship, they face serious barriers to accessing services, exercising rights or rebuilding their lives. In contexts of displacement, statelessness amplifies exclusion and presents significant governance challenges, particularly around legal protection and long-term integration.

These intersecting crises (protracted conflict, climate stress, internal displacement and statelessness) are shifting the nature of displacement. What was once treated as a temporary humanitarian issue is increasingly becoming a long-term governance reality. States must adapt to a future in which managing human mobility, protecting rights and ensuring cohesion will be core to resilience and legitimacy.

Critical considerations for state governance in the future: In what ways will migration reshape national identity politics and state legitimacy? How might private sector actors and civil society influence integration policies for displaced populations?

 

4.3.4 Governing in an Unequal World

Inequality, within and between countries, remains one of the most persistent and destabilising forces shaping governance in the Global South. It undermines state capacity, corrodes legitimacy and fuels unrest, polarisation and policy gridlock. Chart 17 shows income inequality (GINI coefficient across regions) from 2020 to 2050. Despite decades of poverty reduction, progress has slowed: as of 2024, 8.5% of the world lives on less than US$2.15 a day, and nearly half survive on under US$6.85, a fragile threshold in middle-income contexts.

While the number of high-inequality countries (Gini > 40) has declined, around 1.7 billion people still live under such conditions, especially in Sub-Saharan Africa and Latin America. In these contexts, inequality is not just economic; it is deeply political. It erodes public trust, constrains fiscal space for inclusive investment and breeds perceptions of the state as either absent or captured by elites. Even in growing economies, inequality restricts redistribution, deepens social and spatial divides and entrenches elite dominance. In fragile and conflict-affected settings, it intersects with identity, geography and history to drive fragmentation and violence.

Global structural divides compound these pressures. Despite decades of globalisation and development aid, the prosperity gap between North and South remains stark. Achieving a basic income of US$25/day for all would require global incomes to rise fivefold, and twelvefold in Sub-Saharan Africa. This reflects entrenched asymmetries in trade, finance, intellectual property and climate governance that overwhelmingly favour wealthier nations. Between 1990 and 2015, over US$240 trillion in net resource flows moved from South to North, via debt payments, profit repatriation and unequal trade. In 2023 alone, developing countries spent over US$1.4 trillion on debt servicing, diverting vital resources from health, education and infrastructure. Many economies remain locked into low-value exports, while climate finance remains far below needs, despite the South’s disproportionate exposure to climate risk.

New layers of inequality are emerging around technology and the green transition. The rapid spread of artificial intelligence, automation and digital platforms risks widening digital divides in countries that lack access, skills or regulatory frameworks. Meanwhile, green industrial strategies in wealthier nations—focused on clean tech, critical minerals and carbon markets—risk entrenching new forms of dependency. Without robust frameworks for technology transfer, financing and inclusion, the green transition may consolidate global power in the North while sidelining the South.

Domestically, inequality is increasingly multidimensional, cutting across income, geography, gender, education and age. Urban-rural divides remain deeply entrenched, with remote areas often lacking access to essential services, infrastructure and economic opportunities, leading to persistent gaps in wellbeing and economic mobility. Youth face persistent barriers to employment, including high unemployment rates, limited job creation, skills mismatches and restricted access to quality education and professional networks, leaving many trapped in precarious or informal work with few pathways for advancement. Women play a crucial role in sustaining economies, contributing nearly 37% to the GDP in low- and middle-income countries. Yet, gender inequality remains pervasive. On average, women earn 20% less than men and carry around 76% of unpaid care responsibilities. Political representation is similarly skewed, with women holding just 26% of parliamentary seats in Africa, 23% in Asia and about 35% in Latin America and the Caribbean. Addressing gender disparities is not simply a social imperative; it is central to fostering economic growth, driving innovation, building inclusive institutions and charting a path towards genuinely sustainable development.

In addition to these broad dimensions of inequality, it is crucial to acknowledge the particularly acute and entrenched exclusion faced by Indigenous communities across the Global South. Indigenous communities experience disproportionately high levels of inequality and exclusion. Although they make up approximately 6.2% of the global population, they represent 18.2% of those living in extreme poverty globally. In Asia, which is home to over 70% of the world’s Indigenous peoples, poverty rates in these communities are nearly three times higher than the regional average.

Yet, many states continue to govern with centralised or outdated institutions, ill-equipped for today’s diverse and aspirational populations. Addressing inequality requires a fundamental rethink of economic governance: its values, tools and institutions. This means building progressive fiscal systems by investing in universal services and inclusive growth and reforming governance structures to enable meaningful participation. Internationally, systemic reforms in debt architecture, trade rules and climate finance are vital to restoring agency and expanding development pathways for the Global South. Inequality is a defining challenge, and how it is addressed will shape the ability of states to govern with legitimacy, stability and inclusion in a rapidly changing world.

Critical considerations for state governance in the future: How might persistent and multidimensional inequalities reshape the state's legitimacy, capacity and priorities in the Global South over the coming decades? What new forms of governance—formal or informal—could emerge if state institutions cannot deliver inclusive growth, representation or basic services? In an increasingly unequal global system, what strategies could Southern states use to assert greater agency and reconfigure their role in international governance?

 

4.3.5 Extreme Poverty in the Global South

Extreme poverty remains one of the most entrenched and consequential challenges shaping the trajectory of social governance across the Global South. While global poverty rates have fallen significantly over the past four decades, this progress has been deeply uneven. According to current projections, Sub-Saharan Africa will continue to host the highest concentration of people living below the international poverty line (US$2.15/day) well into 2050, even as other regions edge closer to near-eradication. Chart 18 presents extreme poverty by region from 1981 to 2050.

The implications for governance are profound. Extreme poverty is not only a humanitarian crisis. It is a political and institutional one. It erodes the social contract, entrenches exclusion and weakens trust in public institutions. If left unaddressed, it becomes a chronic governance failure, fuelling instability, forced migration and democratic erosion.

This divergence reflects deeper institutional and governance gaps. In regions like East and South Asia, poverty reduction has been driven by state-led investments in rural infrastructure, education, industrial policy and market integration. China, in particular, achieved historic poverty eradication through a highly centralised, top-down governance model, marshalling resources and enforcing accountability with remarkable speed and scale. Yet, this success came with trade-offs: limited civil liberties, constrained public voice and minimal democratic oversight.

This raises a deeper question for other countries in the Global South: Can poverty be reduced quickly without sacrificing democratic values? In many African and Latin American states, democratic governance offers space for participation and voice, but struggles with capacity, continuity and fiscal constraints. The challenge is not only how to deliver at scale, but how to do so inclusively, transparently and sustainably. The Global South does not face a binary choice between fast delivery and democratic inclusion, but it does face a difficult balancing act. The future of poverty reduction will depend on whether states can bridge this divide, governing not only to reduce poverty, but to do so in a way that builds trust, resilience and long-term legitimacy.

Critical considerations for state governance in the future: Could persistent extreme poverty in rapidly growing societies lead to the rise of alternative governance systems that bypass the state altogether? How might the inability to address deep poverty reshape public perceptions of legitimacy and shift expectations from state-led to community-led solutions?

 

4.3.6 Public Trust and Participatory Governance

In many parts of the Global South, trust in the state is not absent, but selective and situational. Citizens often differentiate between levels and types of authority: they may trust local leaders while distrusting national elites; rely on traditional authorities for justice, yet still participate in national elections; and engage with flawed institutions simply because no viable alternatives exist. These are not contradictions; they reflect the adaptive strategies people use to navigate complex and often fragmented governance systems.

At the same time, civic participation is expanding in both scope and form. Digital platforms, street protests and community-based oversight are reshaping the public sphere, particularly among youth, women and marginalised groups. Movements such as #EndSARS in Nigeria (a youth-led uprising against police brutality and impunity), feminist constitutional assemblies in Chile (demanding structural gender equality in governance) and youth-led protests in Tunisia (addressing unemployment, corruption and political inertia) reflect a shift toward decentralised, digitally enabled and emotionally charged forms of engagement. These are not just critiques of existing institutions; they are calls to co-create alternative futures.

Yet, as explored earlier in this theme, a persistent gap often separates participation from institutional performance. Regions such as Sub-Saharan Africa and Latin America consistently score relatively high on Voice and Accountability in governance indices, yet continue to perform poorly on Government Effectiveness and Regulatory Quality. This disconnect highlights a critical insight: participation alone does not guarantee legitimacy, especially when institutions lack the capacity, agility or political will to absorb and act on civic demands. In such contexts, engagement can backfire, fuelling frustration rather than trust.

Conversely, in parts of East and Central Asia, states with limited political freedoms have achieved comparatively high institutional performance. These systems tend to be centred on delivery rather than deliberation, suggesting a different kind of state-citizen compact—one where legitimacy is built through consistent outputs rather than input. While not a model to emulate, this trajectory challenges the assumption that democratic openness and governance capability always go hand in hand.

What emerges is a deeper lesson: trust is not a byproduct of participation; it is earned through systems that can deliver, adapt and include. It is shaped by who is invited to participate, how voice is mediated and whether civic engagement is safe, meaningful and consequential.

Encouragingly, some governments are beginning to bridge the participation-performance gap. Brazil’s participatory budgeting initiatives have empowered citizens to co-decide on public spending priorities. Kenya’s open data platforms have created new avenues for public oversight and policy transparency. Indonesia’s youth councils provide formal mechanisms for young people to influence national decision-making. In more hybrid forms, indigenous autonomies in Bolivia and religious mediation systems in Northern Nigeria offer culturally embedded governance models that maintain legitimacy outside of formal state structures.

These examples underscore that legitimacy is not built through participation alone, but through responsiveness, representation and trust. In an era of rising citizen expectations and intensifying digital connectivity, states that fail to close the gap between voice and action risk eroding the very foundations of their authority.

Governments will increasingly need to engage proactively with these citizen-led initiatives, not only to preserve legitimacy and manage social tensions, but also to navigate growing civil society pressures. However, in many contexts, these spaces are shrinking. Rising authoritarianism, including increased surveillance, internet shutdowns and repression of rights defenders, is limiting the ability of civil society to organise and influence governance outcomes.

Critical considerations for state governance in the future: Will increased civic engagement lead to more responsive governance, or will it challenge state control and stability? How might declining public trust in governance structures impact the effectiveness and legitimacy of governance models?

Technology and Innovation

4.4.1 Data Governance and Digital Sovereignty

The digital revolution is reshaping the very foundations of statehood, transforming how authority is exercised, how legitimacy is built and how sovereignty is asserted. In the Global South, the rapid expansion of digital infrastructure and emerging technologies presents both extraordinary opportunities and profound risks. States now operate in a digital landscape where core governance functions like data, identity, communications and regulation are increasingly mediated by external actors.

At the centre of this transformation lies a fundamental question: who sets the rules, who owns the systems and who benefits from digital power? In many countries, the state is no longer the chief architect of its digital future. Cloud servers are hosted offshore. Algorithms are proprietary and opaque. Platforms headquartered abroad shape political discourse, digital economies and civic mobilisation, often beyond the reach of national regulation. As a result, states are held accountable for outcomes they do not fully control.

This asymmetry is compounded by limited regulatory capacity to manage emergent technologies, ranging from artificial intelligence and biometric surveillance to digital currencies and satellite internet. Some governments have responded by consolidating digital infrastructure under central authority, invoking national security to justify tighter restrictions. Others remain digitally dependent, struggling to enforce data protection, algorithmic accountability or ethical deployment frameworks.

The growing use of internet shutdowns has emerged as a particularly concerning trend. In 2024, the global total reached an all-time high, with at least 296 shutdowns recorded across 54 countries. While Asia accounted for the highest number of incidents, driven largely by India (84) and Myanmar (85), Africa saw the widest spread of shutdowns, with 21 disruptions across 15 countries. In many of these cases, such as in Ethiopia, Sudan and Senegal, governments imposed blackouts during elections, protests or periods of unrest to stifle mobilisation or obscure state violence. In some areas, armed groups have also disrupted access by attacking physical infrastructure. The trend is accelerating, signalling a broader shift toward digital repression and raising urgent questions about the limits of civic space and the future of digital rights in the Global South.

These practices expose a deep paradox: while governments in the Global South increasingly criticise foreign tech platforms for overreach, many simultaneously deploy digital repression domestically. Shutdowns, surveillance and censorship are justified in the name of combating disinformation or preserving order. Chart 19 presents the number of global internet shutdowns from 2016 to 2024. This dual dynamic of external dependency and internal restriction has produced a crisis of legitimacy in both public and private digital governance.

Emerging technologies further complicate this landscape. Tools like satellite internet (e.g. Starlink) may bypass state censorship but operate in legal grey zones, raising new questions about enforcement, access and digital jurisdiction. While such technologies may increase connectivity, they also challenge the regulatory primacy of the state, especially where domestic legislation has not kept pace.

Amid these challenges, several states and regional bodies in the Global South are advancing more inclusive and strategic approaches to digital sovereignty; ones that prioritise public value, rights-based governance and civic participation. The African Union’s Data Policy Framework is a notable example, promoting cross-border cooperation and local ownership of data as a continental priority. In India, the development of Digital Public Infrastructure (DPI)—including platforms like Aadhaar for identity, UPI for payments and DigiLocker for document access—has shown how large-scale digital systems can be built under public control while remaining open, interoperable and privacy-aware.

In Indonesia, the 2023 launch of INA Digital aims to consolidate thousands of fragmented e-government services into a unified, citizen-centric ecosystem. This effort reflects a broader shift toward digital coordination as a means of improving service delivery and transparency. Similarly, Rwanda has emerged as a digital governance leader, using platforms like IremboGov and partnerships through its Centre for the Fourth Industrial Revolution (C4IR) to align emerging technologies with inclusive development goals and ethical oversight. Across Latin America, civic tech ecosystems such as Codeando México and Meu Rio in Brazil are demonstrating how bottom-up, open-source innovation can enhance public accountability and citizen engagement, especially where formal state systems fall short.

These trends reflect two overlapping but distinct dynamics: the strategic assertion of digital sovereignty in a fragmented global tech landscape, and the growing use of digital tools for social control within increasingly authoritarian settings.

Critical considerations for state governance in the future: How might the rise of platform governance challenge the state's monopoly over information, identity and service provision? Could digital infrastructure become the primary tool of state control, enabling governments to centralise authority through surveillance, biometric systems and algorithmic decision-making?

 

4.4.2 Digital Divides

Despite major gains in global connectivity, digital exclusion remains a defining governance challenge. Chart 20 depicts internet access across regions from 2020 to 2050. As of 2023, nearly 2.7 billion people (one-third of the world’s population) remain offline, with the vast majority living in developing and least-developed countries.

In Sub-Saharan Africa, fewer than 1 in 5 rural residents have internet access. In India, only 24% of rural households are connected, compared to 66% in urban areas. These disparities are not merely about bandwidth; they represent systemic exclusion from essential public goods: education, healthcare, finance, social protection and democratic participation.

The digital divide is compounded by persistent barriers to hardware access. In many low-income contexts, smartphone ownership remains low, and the cost of devices or data plans remains prohibitive. Even where basic infrastructure exists, economic, geographic and infrastructural inequalities limit meaningful digital participation. For millions, digital government remains an abstraction—one they cannot afford to access.

Gender disparities further exacerbate the digital divide. Globally, women account for a disproportionate share of the offline population, with a 17% higher likelihood of being offline compared to men. Even when access is available, women often face barriers such as lower digital literacy, limited device ownership and cultural norms that restrict their online engagement.​

The digital divide between rural and urban populations remains a critical barrier to inclusive governance and equitable development. Globally, internet access is heavily skewed toward urban centres, where connectivity infrastructure, digital literacy and economic opportunities are more readily available. In contrast, rural communities, particularly in the Global South, continue to face limited or unreliable access to digital networks, affordable devices and essential services delivered through digital platforms.

This divide is especially pronounced in regions like Sub-Saharan Africa and South Asia, where large portions of the population live in rural areas. For instance, in many countries across these regions, fewer than 20% of rural residents have reliable internet access, compared to more than 60% in urban areas. The result is a layered form of exclusion: from education, healthcare, financial services and civic participation.

The impact on governance is increasingly evident. As governments digitise service delivery and public engagement, those without internet access are effectively excluded. Individuals who remain offline are unable to access benefits, provide feedback or participate in decisionmaking. They are disconnected from systems designed to serve them, yet still subject to the decisions those systems generate.

This is not merely a technical challenge. It is a matter of equity and public trust. When digital platforms become the primary channel for interaction between states and citizens, digital inclusion must be treated as a public infrastructure priority. Without this, digital transformation risks reinforcing exclusion and inequality rather than reducing them.

Critical considerations for state governance in the future:   What role should the state play in coordinating with non-state actors, such as tech firms, telecom providers and international organisations, to expand affordable and high-quality digital access? How might civil society and grassroots digital movements challenge or complement state-led governance in the digital space?

 

4.4.3 Emerging Technologies and the Future of State Capacity

Emerging technologies, including artificial intelligence, quantum computing and digital twins, are rapidly redrawing the boundaries of state capacity, legitimacy and citizen engagement. For countries in the Global South, these tools offer the promise of leapfrogging institutional bottlenecks and legacy infrastructure. But they also carry profound risks: of reinforcing dependency, exacerbating exclusion and enabling authoritarian control, especially when governance systems are weak or underregulated.

One of the most visible arenas of this transformation is GovTech, which is the application of digital tools to modernise public administration, service delivery and civic engagement. From AI-driven welfare distribution and blockchain-based registries to biometric identification systems and predictive policing, GovTech is rapidly becoming the digital interface of the state. But this shift is not inherently democratic or inclusive. Poorly designed systems can embed bias, marginalise vulnerable groups and entrench top-down control rather than fostering responsiveness and accountability.

The appeal of "leapfrogging" through the Fourth Industrial Revolution (4IR) is particularly strong in low-capacity contexts. In theory, digital technologies can help states bypass slower development pathways and deliver smarter, more connected systems for health, education, land governance and disaster response. Success stories such as India’s Digital Public Infrastructure (DPI), Rwanda’s IremboGov platform, and Indonesia’s INA Digital initiative demonstrate how strategic adoption can enhance state reach and agility.

• India’s DPI, encompassing platforms like Aadhaar (digital ID), Unified Payments Interface (UPI) and DigiLocker (digital document storage), has transformed service delivery by enabling presence-less, paperless and cashless transactions at scale. This infrastructure has been pivotal in expanding financial inclusion and streamlining welfare distribution.
• Rwanda’s IremboGov, launched in 2015, has digitised over 100 public services, ranging from motor vehicle inspections to marriage certificates. This initiative has significantly reduced bureaucratic hurdles and improved citizen access to government services.
• Indonesia’s INA Digital, introduced in 2024, aims to consolidate various government services, such as healthcare, education and social assistance, into a single, integrated digital platform, enhancing transparency and efficiency in public service delivery.

These foundations remain underdeveloped in many fragile or low-capacity environments. Technologies are often introduced through external vendors, donors or geopolitical partnerships, raising critical concerns around data sovereignty, long-term sustainability and strategic autonomy. When innovation is externally driven and unaligned with domestic governance systems, leapfrogging can quickly devolve into outsourcing, and digital dependency can replace developmental progress.

As discussed earlier, the digital divide continues to widen. Across much of the Global South, rural areas lack reliable connectivity, smartphones and mobile data remain unaffordable, and women, older people and people with disabilities face persistent structural barriers. When emerging technologies are rolled out without addressing these divides, they risk hardwiring inequality into new digital systems.

Ultimately, technology will not save governance, but how it is governed will shape the future of the state. Governments that can align innovation with ethical frameworks, inclusive design and responsive institutions will not only expand their operational capacity, but they will also redefine what legitimacy, accountability and public service look like in the digital century.

Critical considerations for state governance in the future: As technology enables more decentralised and data-driven decision-making, could future governance models move away from centralised state control toward more networked, participatory systems, and what would that mean for accountability and legitimacy? How might adopting digital governance tools shift the balance of power between traditional state institutions and emerging non-state actors such as tech companies or decentralised communities?

 

Climate and Resource Governance

4.5.1 Climate Change and Environmental Governance

Climate change is no longer a distant threat but a present, systemic stressor that affects how states govern, plan and deliver on their development agendas. For countries in the Global South, the stakes are especially high. Despite contributing the least to global emissions, they face the most severe impacts: intensifying heatwaves, floods, droughts, food insecurity and rising sea levels. These challenges are already placing enormous pressure on state institutions, especially those responsible for infrastructure, disaster response, health and resource management. Chart 21 presents the overall climate vulnerability and readiness to adapt by region in 2022.

The core challenge is strategic: how can states build governance systems that are resilient, inclusive and future-ready, while also responding to immediate economic and social needs?

Balancing Transition and Stability

At the heart of the dilemma lies the just energy transition. Many Global South economies remain heavily dependent on fossil fuels, not just for electricity, but for jobs, foreign exchange and industrial growth. An abrupt shift away from carbon-intensive sectors risks destabilising economies, deepening unemployment and fuelling social unrest. Countries such as Nigeria, Indonesia and India have argued for more flexible, phased pathways, emphasising their right to develop before committing to deep emissions cuts.

While clean energy offers long-term benefits, the transition must be fair and feasible. Without adequate financial and technological support, it risks becoming politically toxic. Effective transitions require more than installing solar panels. They demand investment in skills, infrastructure, and local governance systems that can manage disruption and equitablydistribute benefits equitably. Without these safeguards, climate policy may be seen as externally imposed and become a fuel for resistance rather than reform.

Managing Dependencies and Strategic Autonomy

Global power dynamics further complicate state decision-making. The US, EU and China not only account for a large share of historical emissions, but they also shape the flow of climate finance, policy models and technology transfer. China plays a particularly complex role: as both the world’s largest emitter and a major funder of green infrastructure in the Global South, primarily through the Belt and Road Initiative. While these investments can accelerate access to clean energy, they raise concerns about debt dependency, ecological risks and policy alignment.

To navigate this landscape, states must adopt clear strategies for climate finance, regulatory sovereignty and partnership governance. Some are beginning to invest in domestic tools like green taxation, sovereign climate funds and public-private partnerships to reduce reliance on conditional international aid and to assert more control over their climate agendas.

Beyond Carbon: The Wider Governance Challenge

Climate change is not just about carbon; it is about governance across sectors. Biodiversity loss, land degradation, water scarcity and pollution all threaten the long-term viability of economies and public health systems. States must make difficult trade-offs: expanding agriculture and infrastructure while preserving ecosystems, or investing in green technologies while managing fiscal constraints.

As environmental shocks become more frequent, governance systems will need to be agile and anticipatory, capable of absorbing shocks without collapsing into crisis mode. This means strengthening local institutions, early warning systems and data ecosystems while ensuring citizens trust the state to act fairly and effectively.

Intergenerational and Distributed Governance

Climate change is also a governance challenge across generations. Most impacts will be felt by those who are not yet in power, yet current systems are shaped by short-term political incentives. Future-ready states must find ways to institutionalise long-term thinking, including foresight units, youth advisory councils and climate planning mechanisms that look beyond five-year electoral cycles.

At the same time, non-state actors are increasingly shaping climate outcomes from Indigenous forest guardians in the Amazon and Congo Basin, to youth climate movements in Uganda, India and the Philippines, to feminist environmental coalitions advocating for climate justice. These actors are reframing what climate leadership looks like. They bring grounded knowledge, intergenerational urgency and political pressure. States that seek to govern the climate future must learn not just to regulate these voices, but to work with them as partners in building resilience.

States in the Global South must navigate a complex matrix of pressures: domestic vulnerabilities, global power asymmetries, fiscal limits and rising civic demands. Those that succeed will be those that can turn disruption into transformation by embedding climate action into inclusive, adaptive and sovereign governance systems.

Critical considerations for state governance in the future: How can states align long-term sustainability with pressing economic and social needs? What financial, regulatory and institutional tools will help states secure climate finance without sacrificing autonomy? How will the role of non-state actors, such as corporations, civil society and international organisations, evolve in shaping climate action, and what tensions or synergies might emerge between them and state-led governance in the Global South?

 

4.5.2 Critical Resources and Sustainable Development

As global demand intensifies for energy, minerals and agricultural commodities, states in the Global South find themselves at the centre of critical supply chains that underpin traditional industries and the global green transition. From oil and gas to cobalt, lithium and rare earth elements, fertile land and freshwater, these resources are strategically essential for renewable energy, digital infrastructure and food systems.

However, the ability to turn this resource wealth into inclusive and sustainable development outcomes depends not on the assets themselves but on the governance systems that manage them. This presents a fundamental test of statecraft: Can resource-rich states leverage their endowments to enhance sovereignty, equity and resilience, or will these assets become sources of conflict, elite capture and environmental degradation?

Resource Sovereignty and Geopolitical Contestation

In an era of growing multipolarity, resource governance is increasingly strategic. Countries such as Chile and Indonesia are asserting greater control over mineral exports, imposing processing requirements and restricting raw exports in a bid to capture more value domestically. These moves reflect a broader resurgence of resource nationalism: a push for stronger state oversight, local content policies and national benefit-sharing mechanisms. While such strategies aim to rebalance historical inequalities in extraction, they also carry risks: potential investor flight, retaliatory trade measures or increased dependence on a single partner such as China.

Meanwhile, geopolitical competition over critical materials is intensifying. Major powers, including the US, EU and China, are locking in supply through long-term agreements, infrastructure investments and security alliances. For resource-rich states in Africa, Latin America and Southeast Asia, this raises urgent questions about strategic autonomy. How can states retain decision-making power over extraction, export and downstream processing, without becoming sites of renewed dependency?

Governance, Conflict and Environmental Fragility

The mismanagement of critical resources has long been a driver of fragility and conflict. In countries such as the DR Congo, Sudan and parts of West Africa, competition over minerals, oil and land has fuelled armed violence, undermined state legitimacy and fractured national cohesion. Without robust legal frameworks and enforcement, resource exploitation can entrench war economies, displace communities and incentivise corruption. In many cases, the promise of wealth becomes a trigger for unrest rather than a platform for prosperity.

Environmental degradation adds another layer of volatility. Large-scale mining and land acquisitions, often for biofuels or industrial agriculture, contribute to deforestation, water scarcity and biodiversity loss, undermining long-term food and livelihood security. These ecological disruptions often hit Indigenous peoples, pastoralists and smallholder farmers hardest, exposing fault lines between state development plans and local realities. Without inclusive planning and participatory regulation, environmental governance can provoke protest, legal contestation or even violence.

To govern critical resources effectively, states must move from extractive logics to transformative governance models. This means investing in institutional capacity, transparency, local benefit-sharing and environmental safeguards.

Critical considerations for state governance in the future: How will international institutions and agreements influence national resource policies? How might non-state actors—such as environmental groups, indigenous movements and private investors—reshape sustainable resource management policies?

 

Alternative Futures of the State in the Global South

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• Scenario Framework
• Scenarios

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Scenario Framework

This theme draws on a set of illustrative, long-term global scenarios available in the theme on Africa in the World to explore how state governance in the Global South could evolve under shifting global conditions. In this theme, they were used as a structured framework to explore potential futures for state governance in the Global South, analysing different trajectories for state roles, capabilities and legitimacy in response to global transformations.

Scenarios are not forecasts; instead, they map out plausible and divergent pathways that the world, and states within the Global South, might follow in the coming decades. The four global scenarios are structured around two key axes of uncertainty:

• The extent of globalisation (vertical axis) captures the degree to which countries and regions remain interconnected through trade, technology and cooperation, or shift towards fragmentation, protectionism and regionalism.
• The level of climate mitigation and adaptation (horizontal axis) reflects whether governance approaches prioritise long-term climate resilience, sustainable economic models and environmental adaptation, or whether states adopt weaker, short-term strategies that exacerbate vulnerability to climate change and resource depletion. In some contexts, robust mitigation and adaptation measures emerge deliberately through strong policies and global agreements, while in more fragmented worlds, they may occur at lower, regional levels.

Together, these dimensions form a four-quadrant framework (as depicted in Chart 4), with each quadrant representing a distinct future scenario—a Sustainable World, a Divided World, a World at War and a Growth World.

The scenario impacts were modelled initially to understand how they might play out in the African continent-wide context:

• The Divided World scenario aligns closely with the current real geopolitical trajectory of global developments, representing disaffection with the Western rules-based system even as the latter splinters. This scenario reflects the acceleration of the current trends towards a more fragmented global order, an associated retreat from the previous Western rules-based system and China's more rapid rise to become globally dominant towards the end of the forecast horizon.
• The World-at-War scenario is the worst case for everyone, as overall gains are below those of any other. War in Europe and the Middle East is followed by wars in Asia. This scenario could escalate from the war in Ukraine to conflict in the Middle East or Asia as China and India come to blows. Military expenditures and inequality increase. Africa still grows, but very slowly.
• Neoliberal, trickle-down economics and increased corporate concentration characterise the Growth World This leads to better economic results but to the detriment of equality and efforts to contain global greenhouse gases, resulting in negative climate change impacts. Money, corporate interests and returns on investment dominate.
• As the name indicates, the Sustainable World scenario maximises equity, poverty reduction and sustainability. The international community acts in concert to balance growth and distribution by reducing overall consumption and constraining greenhouse gas emissions. However, it is the most challenging scenario to attain and is most likely to emerge from a crisis, such as the World at War scenario.

It is important to emphasise that these scenarios are not forecasts or predictions. They do not claim to describe what will happen, nor do they reflect a single, linear global trajectory. Instead, they are deliberately stylised frameworks intended to explore a range of plausible futures.  While current trends may align most closely with elements of the Divided World scenario, reality is likely to reflect a more complex and evolving mix of future dynamics.

The value of scenario thinking lies precisely in this openness: it challenges linear assumptions, exposes blind spots and stretches strategic thinking beyond the short term. By exploring alternative futures, decision-makers move from trying to predict the future to building strategic resilience: stress-testing policies, identifying leverage points and positioning themselves to navigate disruptive change with greater clarity and foresight.

Scenarios

The four global scenarios served as a foundational framework to explore potential futures for state governance in the Global South. Subsequently, the key drivers and change signals identified through the Horizon Scan were layered onto this framework. This integration allowed for more robust and contextually meaningful development trajectories.

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5.2.1 Growth World

In the late 2020s, a stunning leadership transition in China reshapes global trade and politics. The sudden death of Xi Jinping, coupled with mounting economic pressures, propels new voices within the Communist Party to relax restrictive policies and court foreign investment. The resulting “Grand Bargain” with the US partially liberalises trade and corporate freedoms. Despite retaining centralised political control and strict data sovereignty policies, China’s strategic opening significantly boosts its global economic position. However, unevenly distributed gains deepen internal inequalities, creating domestic tensions between urban elites and rural populations, as well as between high-tech sectors and traditional industries.

Renewed US economic engagement with China marks a strategic pivot after years of protectionism and decoupling. Trade wars and disrupted supply chains have contributed to rising costs and stagnation in key industries, while inflation and investor pressure push a new administration to recalibrate. Driven by corporate lobbying and economic concerns, the US reopens trade channels, not as an ideological shift, but as a means to safeguard national competitiveness. Business leaders on both sides push for rapid ratification, while the US also seeks to counter China’s growing alliances with rivals like Russia. As protectionist policies recede, a new phase of deepened economic interdependence between the two superpowers emerges.

China reaps early gains, cementing its role as the global leader in high-tech manufacturing through advanced infrastructure, subsidies and AI dominance. Western corporations, reversing the trend of “friendshoring,” return to China in pursuit of cost savings. The EU, once firm on regulation, relaxes its stance to remain globally competitive. As a result, multinational corporations grow more powerful and start to play a bigger role in shaping national and international policy agendas. Their growing influence weakens the authority of international institutions like the United Nations, as global governance increasingly becomes driven by corporate interests rather than multilateral cooperation.

In the Global South, state roles shift dramatically. Governments pivot away from direct development strategies toward brokering investment deals, offering tax breaks and suppressing labour costs to stay attractive to capital. While middle-income countries like India, Brazil and Indonesia benefit from trade and investment, long-term growth is constrained by corporate concentration. Resource-rich nations supply raw materials for global industries, yet profits often bypass local economies. In contrast, low-income countries with weak governance see little transformation beyond foreign-led infrastructure built for investor needs, not inclusive development.

This uneven growth fuels deepening inequality. Advanced economies and corporate elites amass wealth, while much of the Global South remains dependent on external finance. Gaps widen between resource-rich and resource-poor nations, and between urban and rural areas. 

Migrants flood into cities seeking opportunity, overwhelming infrastructure and increasing social tensions. Governments respond with repressive measures, including evictions and surveillance, particularly in informal settlements. International migration surges as climate change, land dispossession and economic pressures displace populations, yet wealthy nations tighten borders despite needing foreign labour, highlighting the contradictions between economic demand and political resistance.

Environmental concerns are secondary to growth. Emissions decline modestly through market-driven adoption of renewables and AI-led efficiency, but sustainability is incidental, not intentional. Mechanisms like the EU’s Carbon Border Adjustment Mechanism and China’s Emissions Trading Scheme incentivise selective green practices but fail to curb the broader environmental toll. Deforestation, pollution and water stress hit the poorest countries hardest, while wealthier states adapt more easily. 

By the 2040s, the global economy is much larger, while governance in the Global South grows increasingly subordinate to investor interests. State legitimacy hinges on economic performance, with deep divides in public trust between thriving cities and marginalised regions. Multinational corporations dominate policy, as states compete through deregulation and tax incentives. Local voices and municipal governance are sidelined by national and supranational deals. Ultimately, this growth-first model proves fragile, vulnerable to economic shocks and political backlash as widening inequality, environmental degradation, and unchecked corporate power threaten long-term stability.

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The four global scenarios served as a foundational framework to explore potential futures for state governance in the Global South. Subsequently, the key drivers and change signals identified through the Horizon Scan were layered onto this framework. This integration allowed for more robust and contextually meaningful development trajectories.

Below, each scenario is introduced in a thematic format, highlighting state roles and governance models. A table comparing World Governance Indicators (WGI) across the scenarios is available in Appendix B.

5.2.1 Growth World

Divided World: The Fractured State
State Archetype	The Fractured State The Fractured State identity emerged from the interplay of global fragmentation, resurgent nationalism and diverging development pathways. The erosion of multilateral systems and the rise of protectionist, populist and sovereignty-first movements pushed many states to turn inward, sometimes out of necessity, sometimes for political gain. While such strategies deepened geopolitical and economic divides, they also enabled some struggling economies to reclaim policy space and foster local resilience through selective trade barriers and industrial support. Dominant economies pursued transactional and interest-based foreign policies, selectively engaging with partners and reinforcing asymmetries in influence and access. Many states struggle to maintain coherence in this world of competing systems and contested legitimacy. In contrast, others adapt through hybrid governance models and regional alignments that prioritise survival, autonomy and fragmented stability.
State Structures & Roles	State authority is uneven and contested. It erodes in regions under pressure from internal dissent, fragmentation and the rise of parallel institutions while persisting in some contexts through strong, centralised governance models (e.g., technocratic, authoritarian or hybrid regimes) or elite capture and strategic control of key sectors. Subnational and regional governance bodies gain prominence, often pursuing divergent policies and priorities. National governments increasingly rely on hybrid arrangements with private, local and informal actors to maintain basic functions. Infrastructure and regulatory frameworks vary widely between regions, exacerbating uneven development and governance gaps.
Governance Models	Governance is hybrid and contested, with authority shared or fought over by national governments, regional actors, private entities and informal networks. In some states, strong, centralised governance models (e.g., technocratic, authoritarian or hybrid regimes) shape decision-making, using coercive control, digital surveillance and strategic sectoral management. In others, governance is dominated by elite capture, with narrow interest groups exerting disproportionate influence over policies and resources. Populist and protectionist policies are adopted opportunistically, deepening fragmentation and fuelling exclusionary practices. Regional and local actors step in to fill governance gaps, experimenting with adaptive, informal governance solutions, though often lacking consistency or scalability. Decision-making is reactive and crisis-driven, focused on maintaining short-term stability rather than long-term resilience or inclusion. Formal participatory mechanisms are weakened or co-opted, while some areas experience complete governance voids, filled by opportunistic actors or informal arrangements.
Legitimacy & Social Contract	Legitimacy is fragmented and contested, with competing narratives of nationalism, populism and protectionism shaping public discourse. In some states, coercive governance, digital surveillance and elite control undermine social contracts and erode public trust. In others, albeit unevenly, hybrid governance models and localised initiatives manage to maintain pockets of legitimacy and social cohesion. Formal mechanisms for participation and accountability weaken, replaced by symbolic gestures or performative inclusion, further alienating marginalised groups. Rising inequality and exclusion fuel social unrest and distrust, particularly in regions where governance fails to deliver equitable services and protections. However, some communities strengthen informal social contracts through local resilience initiatives and mutual aid networks, partially compensating for weakened formal institutions.
Geopolitical Positioning	Regional blocs form along protectionist and nationalist lines, prioritising local interests over global cooperation. Dominant economies engage selectively, reinforcing asymmetries in power and influence. Resource-rich regions experience geopolitical competition, with external powers exploiting governance weaknesses. Some struggling states, albeit unevenly, leverage protectionist strategies to rebuild resilience and local industries.
Who benefits?	National elites and political actors capitalise on populist and nationalist platforms. Countries aligned within influential blocs benefit from secure trade, targeted investments and enhanced regional stability. Resource-rich states and regions leverage local control and protectionist policies for short-term gains. Multinational corporations and dominant economies extract value through transactional, interest-based engagements. Private actors fill governance voids in fragile regions, gaining influence and profits. States focusing on local renewable energy and circular economies boost economic and climate resilience. Nations investing in digital infrastructure successfully modernise governance, improve public services and stimulate innovation despite global instability. Prosperous urban and metropolitan centres see concentrated investment, infrastructure growth, technological advancement and service-sector expansion.
Who loses?	Low-capacity states cannot negotiate favourable terms or build local resilience, trapped in dependency cycles. Marginalised communities are excluded from decision-making and vulnerable to elite capture and coercion. Populations in conflict-affected or fragile regions, where governance breakdown exacerbates instability. Countries and regions without strategic resources or geopolitical leverage, left behind in fragmented global alignments.
Risk & Resilience	Fragmented governance increases vulnerability to systemic shocks, including pandemics, climate crises and global economic instability. Populist and protectionist policies risk exacerbating inequalities, fuelling regional tensions and undermining long-term stability. Resource competition and elite-driven policies deepen corruption, weaken resilience and increase conflict over critical assets. Local and regional governance innovations in some areas offer pockets of adaptive capacity and social cohesion, though these are uneven and often undermined by national or global dynamics. Fragmented climate responses disproportionately expose low-income, institutionally weak states to climate shocks, increasing vulnerability and inequality. Escalating geopolitical tensions and militarisation divert resources from social and economic priorities, further weakening resilience. The dominance of large tech corporations amplifies digital divides, surveillance risks, misinformation and external influence vulnerabilities.
Worldwide Governance Indicators (WGI)
Voice & Accountability	Fragmented civic space: In some states, digital platforms and grassroots networks strengthen participatory governance, while others suppress dissent under the guise of national security or economic stability. Uneven press freedoms: Independent media thrives in some areas but is heavily restricted in others, with disinformation and state-controlled narratives shaping public opinion. Influence of external actors: Foreign-backed think tanks, tech platforms and advocacy groups shape governance in some nations, further complicating sovereignty and public trust.
Stability	Polarised security priorities: Resource conflicts, migration pressures and economic disparities fuel regional and national unrest, with fragile states unable to contain growing discontent. Selective repression: Regimes use heightened militarisation to control dissent while justifying surveillance and emergency powers.
Government Effectiveness	Divides deepen: States with strong institutional capacity maintain stability and efficient service delivery, while weaker governments struggle to provide basic services due to fiscal constraints or external dependencies. Adaptive vs reactive governance models: Some governments experiment with hybrid governance models, decentralising power where effective, while others resort to short-term crisis management and reactive policies. Military and resource drain: Increased security budgets and economic protectionism divert resources away from education, healthcare and long-term development.
Regulatory Quality	Uneven: Some economies integrate into structured trade blocs with stable regulatory environments, while others resort to deregulation and tax incentives in a desperate bid to attract foreign capital. Inconsistent enforcement of environmental, labour and business regulations leads to policy instability. Advanced economies develop competitive green industries, while lower-income states remain dependent on fossil fuels.
Rule of Law	Some states work to strengthen judicial independence, while others manipulate the courts to reinforce political power and suppress dissent. Corruption and patronage significantly influence judicial outcomes, often granting legal protections that benefit elites and foreign investors at the expense of marginalised groups. Additionally, the erosion of multilateral institutions leads to inconsistent enforcement of trade agreements, human rights laws and climate regulations.
Corruption	Some states implement open data and transparency initiatives, while others bolster oligarchic control by using state resources to ensure political loyalty. While some states effectively prosecute high-level corruption, others protect elites, resulting in selective or nonexistent enforcement of anti-corruption measures. Political actors exploit digital platforms to consolidate power, disseminate propaganda or suppress dissent.

5.2.2 Sustainable World

Sustainable World: The State as Builder of Equitable Systems
State Archetype	The State as Builder of Equitable Systems The state identity shifts toward a proactive planner and steward, balancing economic growth with environmental and social imperatives. This identity emerged from various crises: climate disasters, socio-political unrest and economic shocks. In response, states were compelled to adopt inclusive, participatory and sustainability-focused models, integrating formal institutions with local and Indigenous systems to rebuild legitimacy and resilience. More substantial alignment with citizen priorities and global sustainability norms reshapes state legitimacy and purpose. The state’s role expands to include systems stewardship: building resilience through collective intelligence, civic trust and participatory foresight. In this scenario, formal institutions learn from and co-govern with Indigenous authorities, embedding traditional ecological knowledge into sustainable resource management and reinforcing community trust in governance. This trajectory demands difficult political trade-offs but offers the strongest foundation for durable, equitable development.
State Structures & Roles	Formal institutions are robust, inclusive and resilient, integrating climate, social justice and equity goals into core governance structures. Public institutions coordinate effectively with local and indigenous systems, strengthening legitimacy and adaptive capacity. National and regional governance bodies expand regulatory reach and service delivery, supporting sustainable development and social protection. Structures are designed to enable broad participation and oversight, ensuring transparency, accountability and environmental stewardship. State capacity is actively invested in rebuilding equitable systems post-crisis, balancing global ESG norms with local realities and aligning with reformed global institutions (UN, WTO, IMF) that reinforce sustainability and inclusion.
Governance Models	Governance is inclusive, participatory and adaptive, with power distributed across formal institutions, local governance structures and community-based systems. Decision-making processes integrate foresight planning, stakeholder engagement and digital tools for transparency and collaboration. Indigenous and local governance systems are formally recognised and embedded within national frameworks, ensuring cultural and ecological knowledge informs policy. Functions such as climate adaptation, social protection and economic planning are shared between state actors, local communities and regional bodies, and are aligned with global ESG and climate frameworks. Informal governance actors contribute to resilience through co-governance arrangements, participatory budgeting and crisis-response networks. The model balances structured authority with flexibility, fostering social trust and resilience in a dynamic global environment shaped by strong regional cooperation and international agreements.
Legitimacy & Social Contract	Legitimacy is reinforced by transparent governance, responsiveness and inclusive participation. Recognition of indigenous and local governance practices builds trust, alongside social protection and environmental justice frameworks. Civic participation is meaningful and supported by both formal and community-based mechanisms.
Geopolitical Positioning	States form new alliances and regional blocs centred on sustainability, innovation and inclusive development. Reduced dependence on carbon-intensive trade flows and fossil fuel geopolitics enhances national autonomy. Regional cooperation strengthens the capacity to respond to climate challenges and external shocks. However, not all states benefit equally; those lacking institutional capacity, technological readiness or inclusive governance may be marginalised in these new arrangements, risking dependency on dominant regional players or exclusion from critical decision-making platforms. While the scenario envisions states as builders of equitable systems, in practice, some South-South partnerships may fall short of inclusivity and justice, replicating hierarchical dynamics or extractive practices and limiting the transformative potential of regional cooperation.
Who benefits?	Low-income countries with robust, inclusive institutions benefit from enhanced resilience, fairer global trade terms and increased influence in reformed global governance structures. Middle-income countries leading on ESG, sustainability and inclusive planning strengthen regional autonomy and resilience through regional cooperation and sustainable development policies. High-income countries that adapt to global ESG norms and equitable trade frameworks benefit from stable partnerships, access to regenerative markets and resilient supply chains. Populations benefit from strengthened public services, social protection and equitable economic opportunities driven by inclusive governance. Women, youth, Indigenous and marginalised groups with increased representation, land rights and participation in decision-making. Local communities and social enterprises gain from supportive policies fostering green jobs, circular economies and regenerative practices. Multinational organisations genuinely aligned with sustainability goals benefit from stable markets and transparent regulatory environments. Hybrid governance actors (e.g., state, local and Indigenous authorities) co-governing critical systems, fostering adaptive and participatory governance.
Who loses?	Low-income countries lacking institutional capacity and inclusive frameworks, marginalised from regional cooperation and new global governance structures. Middle-income countries with entrenched elite interests or limited political will, struggling to align with inclusive and sustainability-focused norms. High-carbon industries and actors resistant to sustainability transitions, facing declining economic relevance and influence. Communities and groups in fragile or conflict-affected settings, where governance reforms fail to take root or are undermined by instability. Informal or marginalised local actors are left behind by uneven implementation of inclusive policies and sustainability frameworks, especially where state capacity is overstretched.
Risk & Resilience	Dependency risks emerge, particularly for resource-rich but institutionally weak countries, potentially reinforcing extractive economic dynamics. Digital inequalities persist, leaving less digitally-equipped nations vulnerable to being left behind economically and socially. Regional tensions periodically surface over resource allocation, infrastructure financing and technology sharing, risking diplomatic disputes and instability. Authoritarian governments ' superficial implementation of democratic governance models poses risks of "greenwashing," undermining the credibility of reforms. However, resilience is strengthened through robust social safety nets, participatory governance mechanisms and inclusive economic planning, enabling states and communities to better absorb and adapt to crises. Cross-border cooperation and regional integration initiatives enhance resilience to systemic shocks, including climate disasters, supply chain disruptions and global economic instability.
Worldwide Governance Indicators (WGI)
Voice & Accountability	Improves, as participatory governance, citizen assemblies and digital consultation platforms become commonplace. NGOs, youth movements and local associations have greater freedom and funding to oversee governance processes, enhancing transparency. Reformed global institutions and donors push for inclusive governance, yet uptake depends on local leadership and institutional capacity.
Stability	High stability: Global cooperation and peacekeeping reduce major conflicts. Early-warning systems, climate adaptation plans and inclusive land reforms reduce tensions over scarce resources. Although some local disputes persist, peacekeeping missions and mediation are better funded and more legitimate, further lowering conflict risks. Vulnerable states: Weak governance structures in certain regions still risk slipping into unrest, especially if reforms stall or green projects displace marginalised groups.
Government Effectiveness	Generally high capacity: Many states harness external finance and partnerships for development and public service. Persistent inequalities: Some countries lag in implementing these reforms, leaving pockets of poor service provision. Others face challenges with “green authoritarianism,” where capacity is used to enforce environmental goals but not broaden participation. Systemic and long-term: In states with stronger frameworks, ministries coordinate effectively across social, economic and environmental sectors, yielding more synergistic outcomes. Data-driven: Governments use data tools, feedback loops (e.g., citizen assemblies, local consultations) and pilot programmes to improve services. Adoption remains uneven in weak institutional settings.
Regulatory Quality	Coherent and transparent: Enforced sustainability standards, open data policies and fair trade norms. Civil society and media scrutinise regulatory changes, curbing capture by corporate or political elites. Regional and global alignment: Shared global norms (e.g., revised WTO rules and carbon taxes) ensure markets are more equitable and less exploitative.
Rule of Law	Overall, the judiciary is strengthened. International oversight, capacity building and anti-corruption reforms bolster courts. Greater access to justice helps marginalised groups assert rights. However, inequalities persist where institutional capacity is weak, especially in low-income countries. Greenwashing risk: Certain states proclaim environmental or social justice while maintaining partial impunity for political elites.
Corruption	Overall improvement: Overall corruption levels decline, as transparency norms and accountability structures gain traction globally. Systematic oversight: Open data platforms, climate finance transparency and strong civil-society watchdogs reduce illicit practices. Green dependency risks: Some states exploit green funds or carbon markets for personal gain. Oversight mechanisms vary in effectiveness, especially where local capacity is weak.

5.2.3 Divided World

Divided World: The Fractured State
State Archetype	The Fractured State The Fractured State identity emerged from the interplay of global fragmentation, resurgent nationalism and diverging development pathways. The erosion of multilateral systems and the rise of protectionist, populist and sovereignty-first movements pushed many states to turn inward, sometimes out of necessity, sometimes for political gain. While such strategies deepened geopolitical and economic divides, they also enabled some struggling economies to reclaim policy space and foster local resilience through selective trade barriers and industrial support. Dominant economies pursued transactional and interest-based foreign policies, selectively engaging with partners and reinforcing asymmetries in influence and access. Many states struggle to maintain coherence in this world of competing systems and contested legitimacy. In contrast, others adapt through hybrid governance models and regional alignments that prioritise survival, autonomy and fragmented stability.
State Structures & Roles	State authority is uneven and contested. It erodes in regions under pressure from internal dissent, fragmentation and the rise of parallel institutions while persisting in some contexts through strong, centralised governance models (e.g., technocratic, authoritarian or hybrid regimes) or elite capture and strategic control of key sectors. Subnational and regional governance bodies gain prominence, often pursuing divergent policies and priorities. National governments increasingly rely on hybrid arrangements with private, local and informal actors to maintain basic functions. Infrastructure and regulatory frameworks vary widely between regions, exacerbating uneven development and governance gaps.
Governance Models	Governance is hybrid and contested, with authority shared or fought over by national governments, regional actors, private entities and informal networks. In some states, strong, centralised governance models (e.g., technocratic, authoritarian or hybrid regimes) shape decision-making, using coercive control, digital surveillance and strategic sectoral management. In others, governance is dominated by elite capture, with narrow interest groups exerting disproportionate influence over policies and resources. Populist and protectionist policies are adopted opportunistically, deepening fragmentation and fuelling exclusionary practices. Regional and local actors step in to fill governance gaps, experimenting with adaptive, informal governance solutions, though often lacking consistency or scalability. Decision-making is reactive and crisis-driven, focused on maintaining short-term stability rather than long-term resilience or inclusion. Formal participatory mechanisms are weakened or co-opted, while some areas experience complete governance voids, filled by opportunistic actors or informal arrangements.
Legitimacy & Social Contract	Legitimacy is fragmented and contested, with competing narratives of nationalism, populism and protectionism shaping public discourse. In some states, coercive governance, digital surveillance and elite control undermine social contracts and erode public trust. In others, albeit unevenly, hybrid governance models and localised initiatives manage to maintain pockets of legitimacy and social cohesion. Formal mechanisms for participation and accountability weaken, replaced by symbolic gestures or performative inclusion, further alienating marginalised groups. Rising inequality and exclusion fuel social unrest and distrust, particularly in regions where governance fails to deliver equitable services and protections. However, some communities strengthen informal social contracts through local resilience initiatives and mutual aid networks, partially compensating for weakened formal institutions.
Geopolitical Positioning	Regional blocs form along protectionist and nationalist lines, prioritising local interests over global cooperation. Dominant economies engage selectively, reinforcing asymmetries in power and influence. Resource-rich regions experience geopolitical competition, with external powers exploiting governance weaknesses. Some struggling states, albeit unevenly, leverage protectionist strategies to rebuild resilience and local industries.
Who benefits?	National elites and political actors capitalise on populist and nationalist platforms. Countries aligned within influential blocs benefit from secure trade, targeted investments and enhanced regional stability. Resource-rich states and regions leverage local control and protectionist policies for short-term gains. Multinational corporations and dominant economies extract value through transactional, interest-based engagements. Private actors fill governance voids in fragile regions, gaining influence and profits. States focusing on local renewable energy and circular economies boost economic and climate resilience. Nations investing in digital infrastructure successfully modernise governance, improve public services and stimulate innovation despite global instability. Prosperous urban and metropolitan centres see concentrated investment, infrastructure growth, technological advancement and service-sector expansion.
Who loses?	Low-capacity states cannot negotiate favourable terms or build local resilience, trapped in dependency cycles. Marginalised communities are excluded from decision-making and vulnerable to elite capture and coercion. Populations in conflict-affected or fragile regions, where governance breakdown exacerbates instability. Countries and regions without strategic resources or geopolitical leverage, left behind in fragmented global alignments.
Risk & Resilience	Fragmented governance increases vulnerability to systemic shocks, including pandemics, climate crises and global economic instability. Populist and protectionist policies risk exacerbating inequalities, fuelling regional tensions and undermining long-term stability. Resource competition and elite-driven policies deepen corruption, weaken resilience and increase conflict over critical assets. Local and regional governance innovations in some areas offer pockets of adaptive capacity and social cohesion, though these are uneven and often undermined by national or global dynamics. Fragmented climate responses disproportionately expose low-income, institutionally weak states to climate shocks, increasing vulnerability and inequality. Escalating geopolitical tensions and militarisation divert resources from social and economic priorities, further weakening resilience. The dominance of large tech corporations amplifies digital divides, surveillance risks, misinformation and external influence vulnerabilities.
Worldwide Governance Indicators (WGI)
Voice & Accountability	Fragmented civic space: In some states, digital platforms and grassroots networks strengthen participatory governance, while others suppress dissent under the guise of national security or economic stability. Uneven press freedoms: Independent media thrives in some areas but is heavily restricted in others, with disinformation and state-controlled narratives shaping public opinion. Influence of external actors: Foreign-backed think tanks, tech platforms and advocacy groups shape governance in some nations, further complicating sovereignty and public trust.
Stability	Polarised security priorities: Resource conflicts, migration pressures and economic disparities fuel regional and national unrest, with fragile states unable to contain growing discontent. Selective repression: Regimes use heightened militarisation to control dissent while justifying surveillance and emergency powers.
Government Effectiveness	Divides deepen: States with strong institutional capacity maintain stability and efficient service delivery, while weaker governments struggle to provide basic services due to fiscal constraints or external dependencies. Adaptive vs reactive governance models: Some governments experiment with hybrid governance models, decentralising power where effective, while others resort to short-term crisis management and reactive policies. Military and resource drain: Increased security budgets and economic protectionism divert resources away from education, healthcare and long-term development.
Regulatory Quality	Uneven: Some economies integrate into structured trade blocs with stable regulatory environments, while others resort to deregulation and tax incentives in a desperate bid to attract foreign capital. Inconsistent enforcement of environmental, labour and business regulations leads to policy instability. Advanced economies develop competitive green industries, while lower-income states remain dependent on fossil fuels.
Rule of Law	Some states work to strengthen judicial independence, while others manipulate the courts to reinforce political power and suppress dissent. Corruption and patronage significantly influence judicial outcomes, often granting legal protections that benefit elites and foreign investors at the expense of marginalised groups. Additionally, the erosion of multilateral institutions leads to inconsistent enforcement of trade agreements, human rights laws and climate regulations.
Corruption	Some states implement open data and transparency initiatives, while others bolster oligarchic control by using state resources to ensure political loyalty. While some states effectively prosecute high-level corruption, others protect elites, resulting in selective or nonexistent enforcement of anti-corruption measures. Political actors exploit digital platforms to consolidate power, disseminate propaganda or suppress dissent.

5.2.4 World at War

World at War: The State as Survivalist
State Archetype	The State as Survivalist In the most volatile scenario, the state is reduced to a coercive structure focused on survival, security and territorial control. All WGI indicators decline sharply. Civic space collapses. Public trust is lost. Formal institutions are hollowed out or militarised, and governance becomes synonymous with repression. While some authority may remain, its legitimacy is contested, and its social contract irreparably fractured.
State Structures & Roles	State structures become highly centralised, militarised and survival-focused, prioritising territorial integrity and elite protection. Civilian institutions are hollowed out or repurposed to serve security, surveillance and crisis response functions. Subnational and local governance collapse or become subordinate to national security apparatuses. While public service provision deteriorates, state capacity concentrates in the military, intelligence and resource control sectors. Some regions fracture into autonomous enclaves or warlord-controlled zones where governance authority is highly contested.
Governance Models	Governance is coercive and survival-driven, with power concentrated in military and security institutions. Decision-making is reactive and militarised, sidelining democratic norms, human rights and long-term planning. Governance structures rely on surveillance, resource mobilisation and forced compliance rather than consent. In fragmented regions, governance is opportunistic, with competing factions exercising control through force and transactional alliances. Crisis management dominates, leaving limited capacity for inclusive or equitable governance.
Legitimacy & Social Contract	Legitimacy is rooted in force and fear. Civic trust is replaced by survivalist calculations and coerced alignments. Social contracts disintegrate under exclusion, repression and violence. Resistance is violently suppressed or driven underground. Localised attempts at social cohesion emerge but are fragmented and vulnerable to co-optation.
Geopolitical Positioning	Global cooperation collapses, replaced by competing military alliances and regional power blocs. Dominant economies prioritise strategic interests, using proxy conflicts, resource control and transactional diplomacy to assert influence. Weaker states are coerced into alignment or left vulnerable to external aggression and resource exploitation. Strategic regions (e.g., resource-rich, maritime corridors) become flashpoints for military contestation and coercive economic control. Multilateral institutions are undermined or sidelined, as power politics dominate global relations.
Who benefits?	National elites and military leaders consolidate power by controlling security, resources and surveillance. Dominant economies and regional powers leverage military strength and proxy conflicts to expand influence and secure critical resources. Resource-rich enclaves and wealthy elites can access private security and maintain relative stability. Arms manufacturers, defence contractors and military-aligned industries profit from prolonged conflict and militarisation. Private military contractors and security firms exploit widespread instability and governance collapse for profit and influence. Opportunistic non-state actors expand territorial and economic control amidst conflict.
Who loses?	Everyone loses in World at War, but the severity and nature of losses vary dramatically. Civilians in conflict zones face the most significant harm—displacement, violence, loss of livelihoods and human rights abuses. Marginalised groups, women and youth are disproportionately excluded from decision-making and targeted by coercion and violence. Low-capacity states and fragile regions struggle to survive amidst global militarisation, fragmented governance and resource scarcity. Communities dependent on disrupted trade, aid or regional cooperation face food insecurity, economic collapse and limited access to services. Even dominant economies and military elites encounter systemic risks—economic instability, climate shocks and uncontrollable escalations—that challenge long-term stability and control.
Risk & Resilience	Rapid deterioration of governance, with severe humanitarian consequences including famine, epidemics and mass displacement. Intensified resource-driven conflicts cause ongoing violence in resource-rich Global South regions. Breakdown of international diplomacy and crisis management, undermining conflict resolution efforts and humanitarian aid delivery. States lacking strategic resources or geopolitical value, abandoned amid global competition and conflict-driven priorities. Widening inequalities and entrenched insecurity leave populations outside fortified enclaves in perpetual vulnerability.
Worldwide Governance Indicators (WGI)
Voice & Accountability	Collapses: Emergency rules or martial law suppress civil liberties, free media and free speech vanish. Many NGOs and citizen groups disband or flee conflict zones, leaving minimal avenues for public voice. Local pockets: Where central authority fails, communities self-organise, but have limited or no voice in national affairs.
Stability	Major power confrontations and proxy wars devastate the Global South. Widespread violence: Weak states collapse, fueling mass displacement and resource-driven strife. Refugee crises exacerbate local tensions.
Government Effectiveness	Weak to nonexistent: Governments prioritise survival and channel resources into militarisation and security, at the expense of public service delivery and basic governance functions. Humanitarian crises: Donor-funded relief struggles to fill governance gaps, with limited reach in conflict zones.
Regulatory Quality	Collapse of regulation: In poor countries, formal agencies disband or fall under militia/warlord control. Black markets and war economies overshadow formal regulatory systems, and environmental and social standards are abandoned. Conflicts revolve around critical resources (oil, minerals, farmland), with no effective oversight to curb exploitation or environmental harm.
Rule of Law	Systemic breakdown: Courts and police lose legitimacy or cease to function in war zones. Criminal networks, militias or external powers exert absolute control. Militia justice: Rival factions impose extrajudicial “justice,” fueling retaliatory cycles. Arbitrary coercion: Civilians endure extrajudicial punishments, kidnappings or forced property seizures with no legal recourse. Fortified enclaves: Some wealthier enclaves enforce rudimentary security and legal frameworks to protect high-value assets, but these are exceptions.
Corruption	Rampant corruption at all levels: Wartime economies run on bribery, smuggling and siphoning of aid. Resource-fueled patronage: Warlords and militias reward loyalty with access to stolen relief supplies or confiscated assets. Survival mode: Even relatively stable governments use patronage and corruption to maintain alliances, fueling widespread distrust.

Strategic Conclusions: Navigating State Governance Futures in the Global South

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• Briefly
• Beyond the State: Navigating Hybrid Futures of Governance
• Inequality Undermines all Futures
• The Participation-Performance Gap
• Future-Proofing Governance
• Rethinking South-South Cooperation: From Solidarity to Strategic Alignment
• From Tools to Systems: Rethinking Digital Governance
• The Rise of Performative States: Governance as Delivery, Legitimacy as Outcome
• A Platform for Strategic Action

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Briefly

While traditional governance paradigms stress centralisation, uniformity and bureaucratic authority, today’s realities demand something else: adaptability, legitimacy and negotiation. From ecological crises to demographic shifts and digital disruptions, these pressures are remaking what the state is—and what it must become.

The foresight scenarios in this theme—Sustainable World, Growth World, Divided World, and World at War—each illustrate different outcomes for governance legitimacy. They also help us identify the drivers, fault lines and opportunities that define the future of statecraft. This section distils seven strategic insights, urging a move away from standardised governance toward agile, locally driven approaches that incorporate systems thinking and a forward-looking perspective.

Beyond the State: Navigating Hybrid Futures of Governance

Across much of the Global South, the state no longer monopolises authority. Governance is increasingly hybrid, dispersed across customary courts, religious institutions, digital platforms, non-state armed actors and localised civic organisations. These systems are not always the result of state failure. They often emerge as adaptive, legitimate frameworks, deeply woven into social contracts and, in many cases, trusted more than formal state institutions—particularly in regions scarred by historical exclusion, repression or neglect.

The implications of this shift are starkly illustrated in the foresight scenarios. In the Growth World, public participation is reshaped into a symbolic or procedural performance, used to legitimise elite-driven development rather than shape it. Citizens are expected to “trade voice for development,” accepting limited influence in exchange for visible economic gains. This model creates a transactional form of legitimacy, where performance metrics, rather than inclusive politics, become the dominant standard. In such contexts, hybrid governance morphs into a tool of control and co-optation, not empowerment.

In the Divided World, hybridity becomes unstable and fragmented. Authority is negotiated locally, often between contested actors with divergent aims—from militias and criminal groups to donor-funded local councils. Governance becomes reactive and geographically uneven, exposing citizens to inconsistent rights, services and protections. In these fractured systems, the absence of inclusive frameworks creates fertile ground for elite capture, clientelism and prolonged unrest.

By contrast, the Sustainable World models a more hopeful trajectory. Here, improvements in governance indicators—such as Voice and Accountability, Rule of Law and Regulatory Quality—enable hybrid systems to become coherent, collaborative and accountable. The state is not weakened by hybridity; it is strengthened by its capacity to convene, coordinate and align diverse sources of legitimacy toward shared developmental and ecological goals. Local councils, traditional authorities and civic innovators are not merely tolerated—they are engaged as co-governors in deliberative processes and shared planning.

The core insight is this: hybrid governance is not inherently inclusive, democratic or equitable—it is a field of contestation. Its outcomes depend on how legitimacy is structured and shared. In the absence of coordination, hybrid systems can reinforce exclusion, deepen mistrust or be captured by entrenched actors. Where inclusion is meaningful and power is genuinely shared, hybrid governance can serve as a foundation for resilience and renewal.

The Sustainable World teaches us that meaningful inclusion, paired with institutional coordination, civic infrastrucure and normative commitments to equity, can transform hybrid governance into a platform for resilience. It is not the hybridity itself that matters most, but how it is structured, who it serves and what values it advances.

The future of statecraft will not hinge on reclaiming monopoly power, but on building the institutional capacities and political ethics to navigate hybridity with purpose. In this future, the state is not defined by coercion or centralisation, but by its ability to co-develop, co-regulate and co-legitimise governance architectures that reflect societal complexity, without abandoning accountability, justice or civic voice. This is the state not as enforcer, but as integrator—capable of shaping futures through inclusion, not just delivering outputs through control.

Inequality Undermines all Futures

A common thread emerges across all four foresight scenarios: inequality is the most persistent and destabilising faultline shaping governance futures. It is not a residual problem to be solved after growth or stability—it is a systemic force that actively determines who is heard, who benefits and who is left behind. Whether economic, spatial, digital or generational, inequality is a deep structural constraint on institutional legitimacy, social cohesion and long-term resilience.

In the Growth World, inequality is embedded into the development model itself. States become highly efficient at delivering for economic elites and global investors, but neglect redistributive functions. Infrastructure, services and institutional capacity are concentrated in growth corridors—cities, trade zones and digital platforms—while rural, informal and marginalised communities are sidelined. This is not simply exclusion by omission; it is exclusion by design. The state's legitimacy becomes conditional, granted based on performance in high-value areas and withdrawn from those deemed politically or economically peripheral.

In the Divided World, inequality deepens along fractured geographies. As central states weaken, governance becomes hyperlocal and highly uneven. Access to rights, protections and services depends not only on income or status but also on geography and allegiance. In one district, a donor-funded civic platform may enable participation and oversight; in another, militia control may replace the rule of law. Governance becomes negotiable and inequality becomes territorial, making national coherence nearly impossible.

Inequality is also evolving into new forms. Digital systems increasingly reflect and reinforce structural bias in both the Growth and Divided Worlds. Connectivity gaps, data exclusion and algorithmic opacity replicate existing disparities under the guise of efficiency. In regions without digital infrastructure, populations are effectively erased from decision-making. Elsewhere, data-driven governance becomes a tool for surveillance or selective delivery, streamlining control without broadening access.

Even in the Sustainable World, inequality persists—not as a collapsing force, but as a limiting one. Global participation, climate finance and donor alignment enable ambitious reform, but outcomes remain shaped by disparities in administrative capacity, political will and historical disadvantage. Fragile or low-capacity states struggle to implement participatory mechanisms or maintain service equity. Marginalised groups may have formal inclusion but limited influence. The vision is inclusive, but the path is uneven. Progress is real, but constrained.

Therefore, inequality is not just a variable—it is the terrain on which governance succeeds or fails. It is the force that shapes every other challenge, and the benchmark against which the legitimacy of future statecraft will ultimately be measured. Addressing inequality demands redistributive ambition, institutional transformation and ethical innovation—a fundamental rethinking of how power, resources and voice are distributed.

The Participation-Performance Gap

Across many parts of the Global South, states have expanded formal mechanisms for civic engagement—elections, decentralised governance, digital feedback tools and public consultations are now more accessible than ever. Yet, in several cases, this growth in participatory infrastructure has not translated into stronger governance outcomes. Instead, it has revealed a disconnect between political voice and state capacity—a gap between citizen input and institutional response. Voice has increased, but its impact has often lagged.

This dynamic is evident in regions such as Sub-Saharan Africa and Latin America, where countries score relatively high on Voice and Accountability, yet continue to perform poorly on indicators like Government Effectiveness and Regulatory Quality. As the theme notes, this reflects a pattern sometimes referred to as premature democratisation, where political participation expands faster than institutional capacity. The result is a fragile governance environment, marked by weak institutions, corruption and unmet expectations.

Governments may solicit input but often lack the capacity, coordination or political incentives to act meaningfully. Participation becomes symbolic—a checkbox exercise rather than a pathway to change. Trust begins to erode over time when people engage but see little improvement in their lived experience. Rather than deepening legitimacy, participation without delivery can fuel cynicism, disengagement or unrest, particularly in settings already strained by inequality or institutional fragility.

This challenges a long-standing assumption in development and governance practice: that participation inherently builds trust and strengthens institutions. In reality, participation without responsiveness can backfire, breeding disillusionment and, in some cases, protest. In fragile democracies, it risks fuelling populist backlash. It becomes a tool of controlled openness in more authoritarian settings, allowing expression without shifting power.

Participation should no longer be treated as a silver bullet or a moral good in itself. Instead, it must be understood—and designed—as one component of a broader governance system: a chain that links voice to power, decisions to delivery and civic engagement to real-world outcomes.

Future-Proofing Governance

Volatility is no longer an exception—it is the baseline condition of 21st-century governance. From climate shocks and pandemics to Artificial Intelligence disruption and resource conflict, the state is increasingly asked to govern complexity at speed and scale. In this new terrain, anticipatory governance is not a luxury but a strategic necessity.

Yet, most governance systems remain structurally short-term in orientation. In the Growth World, governments invest in foresight only where it supports economic performance, prioritising infrastructure, industrial policy and investor confidence. This narrow and instrumental focus obscures the deeper fragilities being embedded in the system. While growth is pursued, social cohesion erodes. Exclusionary governance, suppressed dissent and inequitable development sow the seeds of unrest. The failure to anticipate social backlash undermines the very benefits that growth strategies aim to deliver, exposing these systems to sudden legitimacy loss and destabilisation.

Only in the Sustainable World do we see a decisive shift, where foresight becomes part of how the state operates. Scenario planning, early warning systems and climate-aligned investments are integrated into budgeting, policy design and institutional coordination. Local governments, youth movements and civic organisations are engaged in shaping long-term strategies, not just reacting to short-term shocks. But even here, this transformation is reactive: futures thinking emerges only after legitimacy collapses. The system is redesigned only when its failure becomes undeniable.

This is the deeper strategic risk: waiting for collapse to trigger change. When anticipatory governance is built only in the aftermath of disruption, it may come too late for the most vulnerable—and be driven more by urgency than vision, more by survival than inclusive renewal.

Anticipatory governance must be treated as a foundational capacity, not a peripheral function. It must be embedded across the entire governance ecosystem from central ministries to municipal authorities, from planning departments to civic spaces. Building resilience requires more than reacting to shocks—it demands a long-term commitment to shaping the future before it arrives.

To get there, states and development partners should:

• Institutionalise foresight across government functions—embedding futures thinking into planning, budgeting, regulation, infrastructure and social policy design;
• Invest in system-wide capacity-building—from local authorities and sectoral ministries to civic platforms, statistical offices and budget teams;
• Bridge foresight and action—ensure that long-term thinking informs real decisions, with scenario planning tied to funding cycles, procurement and public investment;
• Enable political space for uncertainty—create safe environments for experimentation, multi-stakeholder visioning and long-term risk navigation;
• Promote a culture of adaptation and learning—through data integration, anticipatory monitoring and futures literacy at all governance levels.

While stakeholders in the Global South will inevitably encounter practical challenges—including institutional inertia, resource constraints, geopolitical tensions and political resistance—these should not be seen merely as obstacles, but rather as critical opportunities for strategic innovation and transformation. Embracing systemic thinking, embedding strategic foresight and strengthening adaptive capacities will empower stakeholders to anticipate and respond to uncertainties effectively. Through sustained commitment and collaborative action, stakeholders can shape governance systems that promote lasting equity, resilience and sustainable prosperity in a rapidly evolving global landscape.

Rethinking South-South Cooperation: From Solidarity to Strategic Alignment

For decades, South-South cooperation has been framed through the lens of shared struggle, postcolonial solidarity and developmental mutualism. However, as economic power tilts toward emerging economies and global geopolitical alliances fragment, this form of cooperation is evolving into something more complex—and potentially more strategic. The rise of regional economic blocs, cross-border infrastructure corridors and new development finance institutions suggests a shift from rhetorical unity to institutional leverage.

In the Sustainable World, this evolution accelerates. Global South states not only coordinate on trade and investment—they co-author governance standards, collaborate on digital regulation and build regional systems for climate resilience and data sovereignty. Here, South-South platforms become drivers of innovation and equity, not merely alternatives to North-led frameworks, but formative centres of new governance paradigms. In the Divided World, however, regional fragmentation mirrors global disarray. Competing blocs emerge, but without coherence or shared principles. Infrastructure is duplicated, standards diverge and cross-border trust erodes. Rather than mitigating global exclusion, fractured South-South coordination amplifies it, locking states into uneven dependencies and eroding collective influence. In the Growth World, cooperation is transactional. Fast-growing economies compete for regional dominance, offering investment, digital infrastructure or development finance to weaker neighbours—often with embedded conditionalities. Here, South-South cooperation risks replicating the asymmetries it once sought to overcome.

The key insight is this: South-South cooperation is not inherently transformative. It will not redistribute power unless it is embedded in governance structures that are accountable, equitable, and future-oriented. As emerging economies gain global weight, the nature of their leadership—and the ethics of their partnerships—will define whether cooperation strengthens collective resilience or entrenches new forms of dependence.

The future of South-South cooperation will depend on states’ ability to move beyond ideology toward co-governance: to align interests without domination, and to co-create institutions that reflect the diversity, dynamism and demands of the 21st-century Global South. This includes not only regional integration and investment alignment but also the strategic transformation of global governance institutions. Securing a meaningful seat at the table will require more than presence—it will require collective bargaining power, agenda-setting capacity and institutional reform. From development finance to digital standards and climate negotiations, Global South states will increasingly need to act as co-authors of global rules, not just subjects of inherited systems.

From Tools to Systems: Rethinking Digital Governance

The accelerating digitalisation of governance is not just about service delivery or technological innovation; it is about the reconstitution of the state itself. In the Global South, where institutional capacity is often uneven and legitimacy contested, the digital layer of governance is rapidly becoming a foundational pillar of how authority is exercised, how trust is built and how citizens are included—or excluded.

However, the deeper question is not just whether technology is adopted; it is how digital systems are embedded in governance frameworks, how data is governed as a public asset and how digital sovereignty is asserted in a global system dominated by foreign platforms.

In the Sustainable World, digital systems are treated as public infrastructure—governed by inclusive design, interoperable standards and embedded rights protections. The state becomes a steward of collective digital assets, working with civic and regional actors to shape accountable, citizen-centred systems. By contrast, digital transformation proceeds rapidly but narrowly in the Growth World. Efficiency and investment attraction dominate, while rights, equity and transparency are sidelined. Digital infrastructure becomes a vector for centralisation and control, entrenching asymmetries rather than dismantling them. In the Divided World, digital space fragments. Competing systems proliferate without coordination, and data becomes both a strategic asset and a contested territory. The state, fragmented and weakened, loses control over its digital ecosystem, ceding ground to private actors, foreign interests or rival domestic institutions.

Digital systems and data governance are no longer peripheral; they are becoming foundational to how states function and interact with their citizens. But this transformation is not just about adopting new technologies. It requires a whole-of-system approach: capable institutions, fair regulation, inclusive design and robust public trust. Crucially, states are responsible for expanding digital access and literacy, particularly for those at risk of being left behind. This means investing in connectivity, education, user protection and civic engagement—empowering citizens to participate meaningfully in digital life. For countries in the Global South, governing digital transformation is not just a technical challenge; it is a strategic task that must be purposefully shaped to serve inclusive development, reinforce sovereignty and build long-term resilience.

The Rise of Performative States: Governance as Delivery, Legitimacy as Outcome

Across much of the Global South, the basis of state legitimacy is quietly shifting. Citizens are increasingly evaluating their governments not by institutional form, political ideology or electoral processes alone, but by visible results like roads built, services delivered and needs met. As trust in formal institutions wanes and expectations rise, legitimacy is being recalibrated around outcomes, not just procedures.

This turn toward performance is not without merit. It reflects a grounded logic: in contexts where formal democracy has not consistently delivered material improvements, citizens gravitate toward evidence of tangible state capacity. In response, many governments are adopting new tools for real-time delivery tracking, digital service platforms and performance-linked budgeting. These measures aim at demonstrating functionality and responsiveness.

Yet, this emerging “governance as delivery” model carries more profound implications. When legitimacy becomes narrowly tied to visible performance, governance risks becoming short-termist, instrumental and depoliticised, structural reforms may be deferred in favour of quick wins. Public voice may be sidelined in the name of efficiency. And in some cases, authoritarian tendencies may be masked by competent administration, raising infrastructure but silencing dissent.

It also reconfigures how institutions function. Bureaucracies are reshaped to optimise for speed, outputs and quantifiable results. But in doing so, they may lose space for deliberation, transparency or public engagement. Participation becomes a performance metric; inclusion is a policy checkbox. Trust is earned through delivery alone in this model, but it remains fragile if outcomes falter or distribution is perceived as unequal.

This raises a pivotal question for the future of the state in the Global South: Can delivery-based legitimacy coexist with democratic renewal, or will the drive for visible performance gradually erode deeper forms of accountability and inclusion?

The answer lies not in choosing one over the other, but in recognising their interdependence. Delivery without trust is brittle; participation without impact is hollow. States must learn to align competence with connection, to link what is built with who benefits and how decisions are made. The most resilient states may be those that treat performance not as a substitute for democracy, but as a platform for rebuilding it.

In the decades ahead, governance may increasingly be judged by whether states can rule and remain relevant: by what they provide and how they empower. In this future, performance becomes a starting point—not the end point—for reimagining public legitimacy.

These seven strategic implications do not offer a roadmap; they offer a lens. Together, they reflect a world in motion, where governance is increasingly defined by flux, friction and the need to navigate intersecting disruptions. For the Global South, the future of the state will not be about replicating existing models, but about crafting plural, context-aware and future-ready governance systems that are capable of transformation under pressure. The scenarios explored in this theme are not endpoints. They are entry points into a deeper conversation about what inclusive, adaptive and legitimate governance could look like in the decades ahead.

A Platform for Strategic Action

This theme is designed as a strategic tool to support more informed, future-oriented governance. Rather than predicting a single outcome, it provides a structured framework for exploring uncertainty, challenging assumptions and identifying options in the face of accelerating change. Governments, civil society, donors and regional actors in the Global South can use this theme to understand emerging risks better, identify new possibilities and strengthen institutional responses to complexity. It supports both strategy and imagination, enabling users to think differently about what is possible, what is preferable and how to get there.

Here are a few practical ways this work can be extended:

• Remix the scenarios: The scenario matrix is flexible. Users can reframe the axes using other key uncertainties, such as shifts in regional cooperation, technology governance or civic mobilisation, to create alternative futures that reflect sectoral, national or institutional concerns. These custom scenarios can be applied in strategy workshops, risk assessments or long-term policy planning.
• Explore preferred futures: Scenarios are not only tools for exploring what could happen; they also support reflection on what should happen. Stakeholders can use them to articulate desirable governance futures based on local priorities, values and reform goals. These preferred futures can then inform backcasting exercises to identify the policy decisions, capacity investments and partnerships needed to close the gap between current trajectories and long-term aspirations.
• Anticipate change and monitor signals: Use the horizon scan and scenario narratives to assess how national development plans, sectoral strategies or donor frameworks align, or misalign, with long-term trends. By providing reference points for plausible futures, they help organisations monitor signals of change and assess whether current developments are moving toward, or away from, preferred outcomes. This approach supports early, adaptive responses to unfolding risks—enabling governance actors to adjust strategies in time to avoid undesirable futures, mitigate harm and seize new opportunities. In doing so, the scenarios promote a shift from reactive crisis management toward proactive, future-oriented planning that is better equipped to deal with complexity and systemic change.
• Strengthen evidence-based governance and institutional learning: Embedding foresight into governance is most effective when supported by credible insights and by continuous, adaptive monitoring of performance and evolving challenges. Tools like the WGI and national governance dashboards can help track trends in areas such as Voice and Accountability, Regulatory Quality and Rule of Law. When used alongside participatory and foresight-driven approaches, these metrics support evidence-based policymaking, grounding reform priorities in real-time data, emerging risks and comparative learning. This can enhance strategic alignment, promote institutional learning and ensure that governance decisions are informed, adaptive and contextually relevant over time.
• Support strategic dialogue and policy design: This theme is also a tool for convening diverse voices to facilitate structured, forward-looking dialogue across ministries, sectors and stakeholder groups. The scenarios and strategic insights offer a shared framework for challenging entrenched assumptions, exploring diverse perspectives and identifying interconnections across policy domains. By encouraging systems thinking and scenario exploration, the theme supports the design of more adaptive, inclusive and resilient governance strategies. It can be used to inform governance reform, development cooperation and cross-sector planning in complex and fast-changing environments.

Embedding foresight into governance systems is ultimately about more than using tools; it is about building a culture of anticipation, learning and long-term thinking that can sustain more resilient and inclusive futures.