Business | Economy

Davos Diary — Day 1

Davos to offer some significant clashes in global perceptions

  • By Francis Matthew, Editor-at-Large
  • Published: 20:30 January 22, 2013
  • Gulf News

The World Economic Forum in Davos is a great opportunity to network with senior government and corporate officials from all over the world, but it is also a chance to step back and listen to world leaders thinking about some of the underlying issues which drive the day to day politics with which they have to wrestle when they go back to their offices.

The deep variety of people at the Annual Meeting means there will be some significant clashes in global perceptions. It will be interesting to see if there is any common ground between Egypt’s Islamist Prime Minister, Hesham Qandil, and the world’s leading capitalists like banker Jamie Dimon, CEO of JP Morgan Chase. It is often instructive to see politicians being given a hard time by the NGOs, so someone like Ali Zeidan, the Prime Minister of Libya, will have to answer questions from Anthony Lake of Unicef.

The newly elected governments in the Arab world came to power after the Arab Spring with huge popular support and strong social policies, but with very little economic expertise. The politicians had spent years dodging secret police, and were expert in opposition politics, but almost totally innocent of how to run a country and nurture an economy.

Therefore is will be important to see the new Arab politicians react to ideas from people like Larry Summers, now back at Harvard after working with the Obama administration for some years, or Martin Wolf of the Financial Times. They have been in power for a year or so, and know what they face at home. If the politicians are open and receptive to the debates at Davos, it will indicate that the new Islamist governments of the Arab world want to find a way forward as part of the global economy. If they shut themselves off, it will be bad news for their people at home as they will be trying to build some new kind of Arab protectionist market.

This kind of cross-cultural economic and social debate is what works well at Davos and has done for many years. The first Annual Meeting was in 1971 when the unknown Klaus Schwab gathered 444 senior European corporate executives and government officials to attend a one-week get-away in what was then the remote Swiss hamlet of Davos, under the aegis of the European Community. The idea was that the delegates and their partners would spend the whole week in informal surroundings, thinking hard abut the major issues that affected their businesses.

Traces of this informal spirit still survive although today’s Annual Meetings are much bigger and much more formal. What does work well is the extended time at the Forum forced on the delegates by its remoteness. This has a powerful effect as people meet initially, and then re-meet several times over the whole week, both on stage and at social events. This means delegates are able to develop ideas more effectively than would be allowed by a quick presentation followed by a flight home.

Over the years, Schwab expanded the remit for what was renamed the World Economic Forum to include providing a platform for resolving international conflicts, as well as nurturing the stakeholder approach to both corporate and political issues, combining the now well-established trio of corporate, government and NGO thinking.

The World Economic Forum promoted its Annual Meeting in Davos as an opportunity for opposing leaders in world conflicts to meet and find a way to resolve their differences peacefully. This led to the Davos Declaration being signed in 1988 by Greece and Turkey; and an important meeting in 1992 between South African President FW de Klerk, Nelson Mandela, and Chief Mangosuthu Buthelezi at their first joint appearance outside South Africa.

Another meeting that has become part of the Davos legend is the astonishing meeting in 1994 between Simon Peres, Israeli Foreign Minister, and Yasser Arafat, PLO Chairman, who reached a draft agreement on Gaza and Jericho. For the two sides in the Palestinian conflict to meet and agree anything was groundbreaking at the time.

But the opposite can happen. At the 2009 Annual Meeting I was the fascinated spectator of a furious row between Turkish Prime Minister Recip Tayyip Erdogan and Israeli President Shimon Peres who was trying to defend his country’s brutal assault on Gaza.

Erdogan insisted on rebutting the Israeli claims that they were defending their own security with the blunt accusation that “You are killing people”, as more than 1,300 Palestinians were killed during Israel’s 22-day aerial, naval and ground assault on Gaza. Thirteen Israeli citizens died over the same period. What sent Erdogan into real fury was Peres’ claim that Turkey would have done the same as Israel if rockets had been falling on Istanbul, so he threw down his microphone and stormed off the stage, flying straight back to Istanbul that night.

Who knows what will happen this week?

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