This year's World Economic Forum in Davos is happening in an era of rising protectionism and de-globalization.
For decades, the World Economic Forum’s annual conference in the Swiss ski resort of Davos has been the summit meeting of global change makers and a platform for promoting a steadily more interconnected global economy. The conference theme this year is much the same, as the elites will gather on January 22-25 under the headline, “Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution.”
Yet, the world has rarely appeared so unwelcoming to the message of Davos.
Expected Davos attendees include more than 250 politicians and nearly 1,000 CEOs and corporate chairs, along with personalities from the sciences, cultural figures and heads of media outlets. In contrast to the WEF’s determinedly forward-looking focus, many of the attendees find themselves preoccupied with pressing tensions including trade fights, a populist surge and the longer-term ills of economic inequality and climate change.
Disputes over world trade and its structure are threatening globalization as Davos has long defined it. Waves of migrants are putting strains on nations, arousing economic and racial fears. Growing inequality is a slow-burning ill that puts in doubt how long economic growth can last if it is not shared. Climate change calls into question the sustainability of the development the world has already achieved.
As always, however, the WEF emphasizes the positive if not the visionary. “We are entering into a Fourth Industrial Revolution,” its conference announcement says, “shaped by advanced technologies from the physical, digital and biological worlds that combine to create innovations at a speed and scale unparalleled in human history.”
The first industrial revolution harnessed water and steam to mechanize production, the WEF explains; the second used electric power to generate mass production; and the third automated production using electronics and information technology. The fourth is “a fusion of technologies that is blurring the lines between the physical, digital and biological spheres,” writes Klaus Schwab, the WEF’s founder and executive chairman. “The possibilities of billions of people connected by mobile devices, with unprecedented processing power, storage capacity and access to knowledge, are unlimited.”
That potential is threatened by growing inequality: “the greatest societal concern associated with the Fourth Industrial Revolution,” Schwab allows. “The largest beneficiaries of innovation tend to be the providers of intellectual and physical capital—the innovators, shareholders and investors—which explains the rising gap in wealth between those dependent on capital versus labor.”
Davos this year will focus on six main issues:
•“Ongoing changes in international relations” and “how to drive future cooperation”
•The future of economics, productivity and the financial system, and how they support “growth and long-term societal well-being”
•The industrial system that will produce services in “health, energy, communication and transport,” including the “principles” needed to guide “new and emerging technologies such as artificial intelligence and gene editing”
•Cybersecurity, and how to make sure that “digital innovation and the technological backbone of the Fourth Industrial Revolution are both secure and trusted”
•Human capital, and how work is “moving from a consumption and materialistic fixation to a more idealistic, humanistic focus”
•Institutional reforms, and how to update them for the remainder of the 21st century, including a “global dialogue on economic cooperation to create a new framework of rules and institutions integrating all aspects of global economic cooperation.” These would include “intellectual property, movement of people, competition policies, data protection, exchange rates, fiscal policies, state-owned enterprises and national security”
Davos is both formal and informal: Much of the action typicallbtakes place outside the assembly rooms where issues such as these are discussed, in the hallways and corridors where attendees can meet, schmooze and sometimes hatch plans. This year in Davos there will be much to debate; and participation, as usual, will be massive. How many of the WEF’s six big issues will be discussed outside the assembly rooms, and how many will be acted upon after the three-day affair ends, remains uncertain.