Some of the world’s most influential leaders will be faced with a familiar set of unsolved problems during the World Economic Forum’s (WEF) annual meeting in Davos, following a year of economic and political stagnation.
Derided by some as being little more than a millionaire’s cocktail party indulging in empty rhetoric, the 43rd gathering of international movers and shakers will again talk about debt crises, rampant unemployment, environmental time bombs and irresponsible finance.
The lack of progress from last January even has WEF founder Klaus Schwab tearing his hair out while lamenting the tendency of many countries to look after their own interests at the expense of finding global solutions. “The fact is that we are still in some way blocked from making progress,” he told a press conference on January 15.
“My hope is that we can approach our global affairs with more optimism. I hope that participants come away…feeling a greater responsibility for society as a whole.”
The title of this year’s WEF Davos meeting – “Resilient Dynamism” – is in itself a misnomer according to Greenpeace Switzerland, which will co-present the Public Eye Award to the “worst company of the year” in Davos once the WEF conference is in full swing.
Problems remain
“Governments and the corporate world are showing great resilience against change but still little positive dynamism,” Michael Baumgartner, head of corporate accountability at Greenpeace Switzerland, told swissinfo.ch.
“If corporations would simply stop creating some of the world’s largest social and ecological problems the rest of us would not have to try to solve them. Solutions can only come via a bottom up approach, with people raising their voices.”
Economically and politically, the world appeared to have stagnated in 2012. Despite the Arab Spring revolution that gripped the Davos conference two years ago, huge problems still exist in Libya, Egypt and particularly Syria.
The global economy inched forwards by 2.3 per cent last year, according to the World Bank, but the leaders of growth, principally China, slowed down. The European Union is still mired in debt and decisionmaking conflict, while politicians in the United States continue to bicker as the country heads towards insolvency.
Financial scandals continued to proliferate among big banks, no less so in Switzerland than in any other part of the world.
And WEF’s own Global Risks Report, released earlier this month, highlights an increased risk of environmental catastrophes as some countries turn their backs on ecological commitments in order to boost economic growth.
Global template?
Switzerland, as host nation to the Davos summit, is held up by some as an example of how to show resilience to shocks, standing as an island of stability amid huge upheaval all around.
Having survived the financial crisis and economic downturn with greater fortitude than most advanced economies, Switzerland is forecast to achieve economic growth of around 1.3 per cent this year – against a slight retraction in the eurozone. Unemployment rates should also remain significantly lower than in most peer nations.
Switzerland was named the most stable place in the world by economics guru Nassim Nicholas Taleb in his recent book, Antifragile.
However, Switzerland is still facing many of the problems identified in the WEF Global Risks report.
To boldly go…
Growing income disparity has prompted an initiative aimed at curbing excessive pay in Switzerland, with voters to decide in March. The annual Worry Barometer, produced by Credit Suisse bank late last year, revealed the biggest fear of the Swiss population to be losing their jobs.
The continued scandals at UBS bank, along with ongoing tax evasion disputes, have prompted fears about the resilience of the financial sector, while the industry frets about the consequences of ever tougher regulations.
“In order to deal with risk you have to take risks. Leaders need to be more innovative and bolder,” WEF Managing Director Lee Howell told journalists at the organisation’s headquarters in Cologny, canton Geneva.
The underlying message was clear: the world’s political and business leaders need to work together to solve problems rather than continue to act in their own interests.