WHY DOES DAVOS MATTER?

WHY DOES DAVOS MATTER?

by February 5, 2018 0 comments

The annual jamboree of best economic brains of the world gets bigger and bigger

The four-day 2018 World Economic Forum (WEF) meeting is dominated by India story. Inter- national politicians and business leaders will ascend to the Swiss Alps for the summit, which is focused on “Creating a Shared Future in a Fractured World”, according to the WEF’s website.

Discussions range from “Saving economic globalization from itself” to “Finding a new equilibrium in the Middle East”. But critics have questioned the WEF’s vision for globalization, and say the talks are unlikely to help redistribute the world’s wealth.

Is this year’s meeting significant?

The WEF says this year’s summit is important because of the debates surrounding globalization. But critics expect more of the same, claiming the WEF is a “talking shop” incapable of delivering meaningful change. “The main critique is that it is a manifest failure of imagination,” Max Lawson, oxfam International’s head of inequality policy. WEF attendees “have had many years now of hand wringing about the growing gap between rich and poor, and very little to show for it … This is clearly because business as usual is good business for those at the top.

“Ultimately it is public mobilisation and public anger that will lead to progressive change.” A report by oxfam published in advance of the Davos summit revealed that half of the world’s population received no share of all wealth created globally in 2017.

Instead, billionaires increased their wealth by $762 bn last year, enough to end “global extreme poverty seven times over”, the UK-based charity’s annual inequality report said. “The model of globalization pursued for the last 40 years had clearly had one set of major winners, the very richest in society,” Lawson said, as he warned the current vision on globalization will create further political, social and economic instability. “There has to be a complete change in the economic model.”

What is WEF?

WEF is a Geneva-based non-profit foundation committed to “improving the state of the world”, according to the organisation’s website. It aims to shape global, regional and industrial agendas by bringing people together through dialogue. Established in 1971 by the German economist Klaus Schwab, the WEF was originally known as the European Management Forum, until a name change 16 years later, in 1987.

What happens in Davos?

The WEF’s flagship event sees world leaders and business chiefs among some 2,500 attendees, from more than 100 different countries.They hear cases for international collaboration as a means of solving global challenges. Mirek Dusek, a member of WEF’s executive committee in- formed that more than 65 heads of state will flock to the “historic annual meeting. “But what is even more important is that these political leaders are going to engage … [with] the issues that really matter to the global agenda,” he said. Those issues include the future of mobility, production, the environment and international peace, Dusek said.

Who’s attending?

US President Donald Trump, Indian leader Narendra Modi, Israeli Prime Minister Benjamin Netanyahu and German Chancellor Angela Merkel are expected to attend. Trump’s attendance, which comes amid an ongoing US government shutdown, would mark the first visit to the annual summit by a sitting US president since Bill Clinton in 2000. Trump’s “America First” agenda runs contrary to the WEF’s pro-globalisation approach.

“What is important is that the big- gest economy in the world is represent- ed here, and for people to understand the economic, and overall international priorities, of the current [US] administration,” said the WEF’s Dusek.

But it is Modi who will have the first word, with the Indian prime minister due to give the summit’s opening ad- dress on Tuesday morning. He is expected to urge international businesses to invest in India, which is on track to becoming the world’s fifth-largest economy this year, according to the International Monetary Fund.

UN Secretary-General Antonio Guterres and Christine Lagarde, the managing director of the IMF, are also expected to attend. More than 1,900 individuals representing private sector companies and 900 members of non- governmental organisations are also expected to participate. Critics use the phrases “Davos Man” and “Davos Woman” as shorthand for attendees, alleging the meeting is little more than an exclusive gathering of global elites.

“It probably sends out the wrong message, namely that globalization benefits a jet-setting elite, when in reality everyone benefits when economies open up to trade,” Sam Dumitriu, head of research at the UK-based Adam Smith Institute, told Al Jazeera. “Politicians need to stand up for trade, migration and markets, [and] if Davos nudges them to speak out, then it’s worthwhile. But, little of note appears to be accomplished at the summit.”

 David child (Courtesy: AL Jazeera News)

 

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