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Graphic Truth: Who's who at Davos
For one week, heads of state, business titans, and thought leaders gather in the Swiss Alps and discuss the world’s most pressing problems. With all of that money, political power, and intelligence in the same room, Davos is, in theory, the perfect place to get big things done.
But that’s not always the case. This year's Davos didn’t surmount tangible progress on climate change, the war in the Middle East, or any of the countless political issues that were on the table to be discussed. Overall, global politics took a backseat at the World Economic Forum. Could this be because political leaders were vastly outnumbered by CEOs? To find out, we looked at who was in the room where it (didn’t) happen.
A pinch of the Davos "secret sauce"?
The 54th annual meeting of the World Economic Forum will begin in Davos, Switzerland, tomorrow, bringing together 2,800 of the world’s most powerful people, including 60 or so heads of state and government.
This year’s theme, as declared by Klaus Schwab, is to “rebuild trust” in a fractured world. The WEF founder was talking about trust in a more certain and optimistic future for people around the globe. But the forum has its own credibility issues that have led many to question whether it is a malign, even malevolent, institution.
On the left, it is pilloried as a gathering of billionaires who have plundered the world and destabilized democracies. In his book “Davos Man: How Billionaires Devoured the World,” New York Times economics correspondent Peter S. Goodman depicted a group of rootless, self-interested internationalists, whose wealth and power are so vast that they believe they are entitled to write the rules for the rest of us.
On the right, Schwab’s idea of a “Great Reset” after the pandemic, which promoted the idea of “stakeholder capitalism,” has been viewed with increasing hysteria. On Fox News, right-wing commentator Ned Ryun said the WEF wants to “create feudalism 2.0, in which we are serfs and they are the lords ruling over us. You’ll have nothing and be happy,” he said, riffing off an essay written by Danish politician Ida Auken for the WEF in 2016, in which she suggested the forum has a goal of limiting ownership of private property.
Davos Man – the perception is that the summit is overwhelmingly attended by men over age 50 – needs a makeover, and the forum could do worse than point to its own history as a constructive force for peace and stability.
In 1988, Greece and Turkey were pulled back from the brink of war to sign the Davos Declaration; in 1989, North and South Korea held their first ministerial meeting in the Swiss Alps, while East German Prime Minister Hans Modrow and West German Chancellor Helmut Kohl met to discuss reunification. In 1992, F.W. de Klerk and Nelson Mandela came together in Davos for the first time outside of South Africa, a visit Mandela later said changed his perception of the world.
The world is in dire need of more exchanges like that – more truth and reconciliation.
Before this year’s meeting, the WEF released its latest Global Risk Perception Study (more on this later). Spoiler alert: The outlook for the world is negative and is expected to get worse over the next decade. Two-thirds of the respondents to the study predict a multipolar world will dominate global affairs over the next 10 years, as the great powers set and enforce, but also contest, rules and norms.
But this is Davos’ secret sauce: Everyone is there (except the Russians, who were not invited). Attendees share meals and build personal relationships. Those behind-the-scenes conversations go unseen by the public but can pave the way for future compromises and agreements.
The formal themes of the forum revolve around four pillars: security and cooperation; growth and jobs; artificial intelligence; and, longer-term strategies for climate change.
But WEF President Børge Brende, a former Norwegian foreign minister, was clear that much of the focus will be on high-level diplomatic talks on wars in the Middle East, Ukraine, and Africa.
“We will make sure we bring together the right people … to see how we can solve this very challenging world,” he said.
This year, the Chinese are back with their biggest delegation since Xi Jinping addressed the forum in 2017, when he portrayed China as a responsible nation and a leader on environmental causes. Premier Li Qiang will lead a large delegation of government officials to send the message that China is open for business. (See Watching below).
Liming Chen, the WEF’s Greater China chairman, wrote in the China Daily this week that Davos acts as a window for Beijing to understand the world and the world to understand China.
US Secretary of State Antony Blinken and National Security Advisor Jake Sullivan will take part in talks on Gaza with Qatar, the United Arab Emirates, and Israeli President Isaac Herzog.
Other attendees will be French President Emmanuel Macron; European Commission President Ursula von der Leyen; and Ukrainian President Volodymyr Zelensky, who has invited representatives from more than 100 countries to a meeting on Sunday to increase support for Ukraine’s peace proposal.
In a world where transnational risks are increasing and global cooperation is eroding, Davos’ blend of bankers and businesspeople; journalists and academics; politicians and royalty (British princesses Beatrice and Eugenie are listed as delegates) is unique.
Follow this newsletter over the next couple of weeks and we’ll tell you how it unfolds.
Skyline view of Davos, Switz., with the St. Johann church in the foreground.
WEF’s worst global threats: Can we weather the storm?
This year’s survey suggests that AI-powered misinformation is the world’s biggest short-term threat. False and misleading information, powered by artificial intelligence, threatens to erode democracy and polarize populations, it says.
In a big election year in the United States, Britain, India, Mexico, and Indonesia, many of the 1,500 respondents from the worlds of business and government worried that fake information could be used to raise questions about the legitimacy of election results.
The WEF report says rapid advances in technology are creating new problems and making existing ones worse. There are concerns that AI chatbots like ChatGPT mean synthetic content could be created to misinform and disinform.
AI is one of the four central themes of the forum, with major industry players like Open AI’s Sam Altman, Microsoft CEO Satya Nadella, and Meta’s chief AI scientist, Yann LeCun, attending.
Extreme weather was the second most pressing short-term risk to the global economy, followed by societal polarization, cyber insecurity, and inter-state armed conflict.
Within 10 years, extreme weather is expected to become the biggest concern, followed by other environmental risks – changes to the Earth’s systems, biodiversity loss, ecosystem collapses, and national resource shortages.
The report’s authors point out that preparedness for global risk has never been more important but that it’s increasingly hindered by a lack of consensus and cooperation.
So we’ll be watching deliberations at Davos this week with the hope of seeing more signs of both.
The national flag of Ukraine flies along with other countries' flags at the congress center for the 2022 edition of the World Economic Forum.
Hard Numbers: Over half a century of summits, Gen-Z brings positivity, Thousands of troops, A pricey lunch
54: Happy 54th birthday to the World Economic Forum. For over half a century, the global elite has traveled to the Alpine town of Davos – with its population of just 11,000 – to discuss the biggest challenges facing the world. It started back in 1971 as the European Management Symposium and was rebranded as the WEF in 1987.
60: Is Davos just an opportunity to hobnob and ski? Not for Gen-Z! A poll from Salesforce found that 60% of Gen-Z is hopeful about the ability of leaders at Davos to make the world a better place – making it more optimistic than any other generation about the summit’s potential.
5,000: With some of the world’s most powerful people gathering in Davos at the same time, security is going to be tight. The Swiss legislature authorized the deployment of roughly 5,000 armed forces to support the summit. Security costs are estimated to be around $10.5 million (9 million Swiss francs).
42: Going to Davos ain’t cheap. It famously costs tens of thousands of dollars to attend the annual WEF meeting, but even the food is expensive. At the Steigenberger Grandhotel Belvédère, which hosts guests in town for the summit, a cheeseburger on the “snack menu” costs roughly $42 (36 Swiss francs).
Swiss Defense Minister Viola Amherd attends a news conference with Philippe Rebord, Chief of the Swiss Armed Forces
Will the Swiss sacrifice neutrality for Sky Shield?
Since 1515, Switzerland has practiced armed neutrality, priding itself on not getting involved in other countries’ affairs. But that could soon change if the land of William Tell joins the European Sky Shield air defense umbrella, which Bern announced on Tuesday it is keen to do.
The Swiss defense minister is expected to sign a declaration of intent to join the alliance when she meets with their Austrian and German counterparts on Friday. Critics fear this will undermine Switzerland’s neutrality and make it militarily dependent on foreign countries, while potentially turning the country into a target.
What is the Sky Shield initiative? Sky Shield is a German-led partnership of 17 European countries and counting. Modeled after Israel's Iron Dome, its goal is to bundle the continent’s efforts to defend against possible aircraft or missile attacks, balancing the costs and speeding up timelines. These defense systems will supplement and fill the gaps in the existing systems established by NATO.
Why join? Switzerland, which is not a member of the EU or NATO, has said that it will only join the alliance on the condition that it will not participate in international military conflicts. But the wealthy Alpine country has been under increasing pressure from its European neighbors to ease up on its commitment to neutrality since Russia invaded Ukraine. Though it did implement sanctions on Moscow, its banks — which are highly secretive and the biggest destination of off-shore wealth — have only frozen around $8 billion of the $49.3 billion of Russian assets in the country.
The Sky Shield decision is likely to ignite the debate over neutrality that has been ongoing since Russia invaded Ukraine. Switzerland’s defense minister had expressed an interest in upping its cooperation with NATO at a meeting in March. In response, conservative politicians are gathering signatures to get a referendum for a stricter interpretation of the Constitution’s neutrality requirement on the ballot in 2024. Neutrality is supported by 90% of the population, but in an era where war is no longer hypothetical, the Swiss are fighting over what that ideal really means.
What We’re Watching: Russia’s Memorial banned, Switzerland vs EU, Venezuela’s oil rebound (for now)
Memorializing Memorial. Russia’s Supreme Court ordered the liquidation of Memorial International, one of the country’s leading human rights organizations, which for the last 30 years has chronicled abuses committed during the Soviet era, including by the KGB, President Putin’s former employer. The court said the group failed to register foreign funding under a state law that many deem unconstitutional. Meanwhile, Memorial Human Rights Center, an affiliate group that has been documenting political repression in post-Soviet Russia, now faces a separate court hearing that will determine its future. In handing down its verdict, the Supreme Court said that Memorial “creates a false image of the Soviet Union as a terrorist state,” but historians sayS the group, established in 1989, plays a crucial role in documenting what happened to millions who suffered the Gulag forced labor camps, as well as other forms of oppression. Memorial’s lawyers say they will launch an appeal, but we’re not holding our breath for an overturned verdict.
Switzerland and the EU have it out. Switzerland and Brussels have long been mired in disagreements about trade and broader economic relations. Now, things have gotten even more heated, with the European Commission warning that relations could break down unless progress can be made in negotiations – immediately. So, what do both sides want? The European Union wants the Swiss – who are not in the EU but are in the European common market – to better align their laws with the EU so that the bloc's members enjoy a level playing field in the small but wealthy Alpine country. Brussels also wants to create a dispute settlement mechanism that will help resolve shortcomings in the 100-odd bilateral agreements that govern trade between the two sides. But Switzerland says that key differences remain, including on issues like whether EU citizens should have access to Swiss social benefits, as well as what rules should govern the movement of people across borders. Bern isn’t relenting just yet, but given how much it relies on access to the EU single market, will the Swiss really continue to play hard ball for much longer?
Venezuela’s oil boom. How has heavily sanctioned PDVSA, Venezuela’s state-run oil company, managed to double its oil output in 2021 compared to last year? Caracas pulled this off in part due to help from its pal Iran, which sent much-needed chemicals that helped Venezuela to pump more of its uniquely heavy and sluggish crude oil. US sanctions make it almost impossible for Nicolas Maduro's regime to get the stuff from elsewhere. PDVSA also managed to reach deals allowing it to defer payments to the smaller contractors who help to operate its oil fields. All of this helped PDVSA reach 824,000 barrels per day in November, a 90 percent boost from the monthly average a year ago. Can the good times continue? That depends in part on Iran's continued largesse, and also on whether PDVSA is able (and willing) to pay back those rolled-over debts to its contractors. Tehran and Caracas – both international pariahs heavily-sanctioned by Washington – recently agreed on a 20-year cooperation accord to strengthen bilateral relations and help them fend off "US intervention."
Swiss photographer on trial in Hong Kong over protest clash
HONG KONG (AFP) - A Swiss photographer went on trial in Hong Kong on Wednesday (Sept 9) charged with public disorder, with prosecutors accusing him of enabling an assault on a Chinese mainlander during last year's democracy protests.