Global economy faces massive funding gap for major transitions

The global economic system is approaching a significant financial challenge. According to the Santander group's annual report, The Year Ahead 2027, the world will require approximately 50 trillion euros between 2026 and 2030 to fund the energy transition, artificial intelligence, aging populations, and rising defense and security needs.

Currently, nearly 30 trillion euros of this requirement is not covered by existing or planned financing sources. This deficit exceeds half of global pension fund assets and is more than double the deposits held by households and businesses in the eurozone. The report suggests that while global savings are abundant, directing them toward productive investments remains difficult due to regulatory hurdles, capital risks, and implementation delays.

In response to climate-related economic threats, the European Commission has introduced a framework to strengthen Europe's ability to manage climate risks. With climate-related damages estimated at 50 billion euros annually between 2022 and 2025, the plan emphasizes the need for approximately 70 billion euros in annual investment to adapt infrastructure and economies to changing conditions.