Developments in technology, demographics, the climate and geopolitics are what will shape the future of the economy and society in the coming years. Anticipating and preparing for this future by meeting our customers’ needs is at the core of who we are and what we do, with a key responsibility to continue fulfilling our essential role in financing and boosting the economy and helping people and businesses prosper.

The speed of change compels us to be open-minded and agile to adapt to and face these challenges in an uncertain environment where geopolitics has been taking centre stage due to the impact of the pandemic and armed conflicts on global value chains, the supply of critical goods and trade relations between different blocs.

The world's centre of gravity of economic, cultural and social influence is likely to shift towards Asia and other emerging countries. India, Brazil and Mexico will remain on the up, while other regions will seek their place in the world. The European Union is engaging in a new political cycle, with the challenge of boosting economic growth and competitiveness while maintaining its international influence. Completing the banking and capital markets union will ease the way, and success will require internationally competitive companies, a change of mindset in public-private partnerships, a less burdensome regulatory framework that favours competitiveness and, above all, political momentum.

In addition to geopolitics, the public and private sectors share challenges they will have to address in the coming years.1 Higher life expectancy and lower birth rates will give rise to large numbers of citizens over the age of 65 in three major economic areas – the United States, China and Europe  – and in many other countries as their standards of living improve. This will increase the need for public spending on healthcare, take resources away from other purposes, and push pension systems to the limit, as well as posing numerous social challenges.

In the financial sector, this will imply greater demand for annuities to supplement public pensions and facilitate asset monetization. As far as the economy goes, fewer people of working age will have to produce more in the face of growing needs, so productivity will have to increase and companies will have to become more competitive.

Technological innovation plays a key role and will continue to be a cornerstone in driving transformation, using resources more efficiently, and closing the productivity gap. Generative AI is expected to inject additional productivity into the global economy to the tune of between USD 2.6 and 4.4 trillion per year (the equivalent to creating Spain’s economy several times a year).

In addition to the possible use of AI, the financial sector will see new challenges and opportunities linked to tokenization, private or central bank digital currencies, the development of the data economy, and other concepts.

The climate challenge will remain on the international agenda and its solution will require greater global coordination, innovative technological solutions and an appropriate regulatory framework.

Santander, which already has a diversified profile in Europe, the United States and Latin America, as well as global platforms and businesses that enable us to leverage scale and manage economic cycles, is geared up to drive this transformation, respond to challenges and find growth opportunities to generate value for our shareholders, our customers and broader society.