Convening the world leaders to discuss global, regional and industry agendas at the beginning of each year, World Economic Forum has been holding the annual meeting for decades. The 49th edition was no different. The Davos 2019 meeting ended with a prime gathering of world class leaders from business, politics, civil society and academia. With the theme “Globalization 4.0: Shaping a Global Architecture in the Age of the Fourth Industrial Revolution”, the meeting focused towards the advancement of its agendas with bold ideas and exciting opportunities so that they can be considered in the year ahead.
Though there has been a controversy of the highest numbers of private jets arriving at the conference, this year’s gathering of the global elites has surely created a momentum. The controversy arose during the conference as one of the leading topics to discuss in Davos 2019 was on global climate change. According to experts’ prediction, up to 1,500 individual private jets carrying political and business leaders and lobbyists arrived this year. “There appears to be a trend towards larger aircraft, with expensive heavy jets the aircraft of choice, with Gulfstream GVs and Global Expresses both being used more than 100 times each last year,” said Andy Christie, Private Jets Director at the ACS.
Davos this year has been a bit different as it had relatively smaller representation of the heads of state and the celebrities. However, a notable number of key figures attended the forum – Germany’s Chancellor Angela Merkel, Japanese Prime Minister Shinzo Abe, Brazilian President Jair Bolsonaro, New Zealand’s Prime Minister Jacinda Ardern, Italian Prime Minister Giuseppe Conte, the IMF Director Christine Lagarde – to name a few.
Divided over the course of four long days, the Forum had over 400 working sessions, 100 governments and 1000 companies from the highest level of leadership as the participants. The span of the event was from 22 January to 25 January.
The annual meeting was held focusing on five working principles:
- Dialogue is critical and must be multi-stakeholder based.
- Globalization must be responsible and responsive to regional and national concerns.
- International coordination must be improved in the absence of multilateral cooperation.
- Addressing the biggest global challenges requires the collaborative efforts of business, government and civil society.
- Global growth must be inclusive and sustainable.
PRECIS OF DAVOS 2019 GLOBAL DIALOGUES
A great series of ‘Global Dialogues’ took place this year focusing on many interconnected areas that play significant role considering the theme itself. The synopsis of these global dialogues have been showcased as follows.
The Geopolitics and a “Multiconceptual” World focused on understanding the major ongoing changes in international relations for driving future cooperation.
Peace and Reconciliation put emphasis on catalyzing large-scale, multi-stakeholder support for diplomatic efforts on key fault lines around the world that stands in the way of international cooperation.
The Future of the Economy focused on the principles that are needed to be redefined for better structural changes in the economic and social decision-making.
Financial and Monetary Systems talked about jointly shaping monetary and financial systems with cryptocurrencies, blockchain and sustainable growth. This really makes sense considering other parts of the world are adopting cryptocurrencies by themselves, for example take this Yuan Pay Group that have started the crypto revolution within China. It only makes sense that many countries and the globe will at some point look to have cryptos as a major legal tender.
Industry Systems anticipated how the Fourth Industrial Revolution provides opportunities to substantially enhance the availability and delivery of services in the areas of health, energy, communication and transport.
Technology Policy defined the principles for new and emerging technologies like artificial intelligence and gene editing for identifying the ethical ideologies and value-based framework.
Cybersecurity aimed to make the digital innovation and the technological backbone of the Fourth Industrial Revolution secure and trusted.
Risk Resilience focused on promoting system thinking in order to radically improve collective and integrated management of the key environmental systems – climate, ocean and biosphere. Because, the betterment of societies and economies depend much on these systems of the environment.
Human Capital discussed its relevance with its future taking into account the substantial change of the notion of work.
A New Societal Narrative demonstrated how the societies are moving from a consumption and materialistic obsession to a more idealistic, humanistic focus.
Institutional Reform discussed on adapting the 20th century’s global institutional framework to make them relevant for the new political, economic and social context for the remainder of the 21st century.
Economic Cooperation talked upon creating a new framework of rules and institutions with the integration of all aspects regarding global economic cooperation; including intellectual property, movement of people, competition policies, data protection, exchange rates, fiscal policies, state-owned enterprises and national security.
However, according to the global agenda, WEF has a plan to integrate the recommendations and proposals from these global dialogues into the Forum’s 14 System Initiatives that curate, align and advance the efforts of the most globally relevant and knowledgeable individuals and institutions who work towards shaping the future.
GLOBAL ISSUES THAT EMERGED IN DAVOS 2019
This year’s meeting had discussions on diverse topics – Climate Change, Health, Economy, Data Privacy, Innovation – to name a few. These discussions shed lights on diverse global issues that are happening around the world, some of which are showcased in detail as follows.
CONVEYING THE MESSAGE OF CLIMATE CHANGE
Davos started with giving an award to Sir David Attenborough for his contribution to environmentalism and ended with the speech of the 16-year-old Swedish climate change activist Greta Thunberg telling world leaders to start panicking about global warming.
Christine Lagarde, the Managing Director of the International Monetary Fund, citied an Oxfam report which shows that 26 of the richest billionaires own the same amount of wealth as half the world’s population.
According to Kristalina Georgieva, the Acting Head of the World Bank, climate change is happening much faster than had previously been thought and had to be tackled urgently.
The new mantra now is to restrict the increase in temperature to 1.5C above pre-industrial levels. This would be a win-win situation – good for the planet and good for the economy – according to the experts at Davos this year.
Davos talked about the responsibilities of companies as well as governments to stop climate change and take the matter of cleaning up the environment seriously. Some of the excerpts of which are demonstrated as follows –
- Google and SAP together announced Circular Economy 2030, a $400,000 competition, to support entrepreneurs who promote sustainable consumption and production.
- Twenty-five global businesses announced to work with Terracycle, a recycling specialist, to launch the Loop Alliance Initiative – a scheme that enables consumers to buy a variety of products in customized, brand-specific durable packaging that is collected, cleaned, refilled and reused.
- For accelerating the circular economy, a partnership among the Nigerian government, Global Environment Facility (GEF) and UN Environment has been introduced in the platform of World Economic Forum. To create a formal waste recycling industry in Nigeria, they are to join with Dell, HP, Microsoft and Philips for launching a $15 million investment.
THE GROWING BREXIT CONCERN
This year, Philip Hammond stood in for Theresa May and the Britain’s Chancellor of the Exchequer had a series of meetings with business chiefs and policymakers in order to reassure them about the government’s approach to avoid a no-deal Brexit on 29 March.
Talking about these growing business worries in Davos, his key message was that the vote to leave had to be respected. However, he added that a no-deal Brexit would be a betrayal of the hopes for a better future of those who voted to leave.
GETTING DIGITAL IDENTITY RIGHT
From the efficiency of the Internet of Things to social inclusiveness, digital identity will be the key.
A report on digital ID coverage was released in the annual meeting which the Forum compiled with McKinsey. The report says that digital IDs can unlock economic value equivalent to 3% to 13% of GDP in developed and emerging economies. However, chances are there that the digital ID system administrators can access to and control over individual data to misuse it; so proper administration is a must.
GLOBAL SPENDING ON ARTIFICIAL INTELLIGENCE INCREASED
It’s been demonstrated that the global spending on AI is forecasted to reach $52 billion in 2021, which will result in achieving a compound annual growth rate of $46.2 from 2016.
The forum has launched an AI toolkit which has been developed to help companies avoid legal and ethical drawbacks. The objective of the kit is rather simple – as more companies adopt artificial intelligence, the algorithms arrayed will not introduce biased results.
BBVA, the large Spanish bank, has already agreed to experiment the toolkit. However, half a dozen of other companies are expected to do the same as well.
JAPAN’S ECONOMIC PROGRESSION
Japan’s Prime Minister Shinzo Abe declared that ‘Womenomics’ had helped pull Japan back from the edge. He said, “A long-awaited positive feedback cycle is taking root, with growth in employment and income generating greater demand and even more employment.” Stating the example of two million women who had entered workforce since 2012, he said that it has played significant role in boosting the economy.
E-COMMERCE HAS CREATED A MOMENTUM
A group of more than seventy countries confirmed to launch WTO negotiations on trade-related aspects of e-commerce following a ministerial meeting in the margins of the Annual Meeting. Shortly before the January 25 announcement, members of the Forum’s business and civil society trade community issued a statement calling for a new digital trade deal with the objective to reduce costs and facilitate greater participation in the global digital economy.
Negotiators from the 76 countries and regions agreed to hammer out an agenda for negotiations on setting new e-commerce rules this year.
“I’ve said for quite some time it was unacceptable that by 2018… the WTO won’t have a deeper, more effective conversation about a phenomenon that is driving the global economy today,” said WTO Director-General Roberto Azevedo.
In a briefing in Davos, he said, “China was not an original signatory but now they are. They have reaffirmed their intention to start negotiations on electronic commerce. I think this is a welcome development.”
POTENTIALITY OF GLOBAL ECONOMIC BLACKOUT
The International Monetary Fund amended its world economic growth forecasts for 2019 and 2020 on the eve of the Forum. Moreover, it cited that China has a bigger-than-expected slowdown in the country’s economy.
According to the prediction of the IMF, the global economy is about to grow at 3.5 percent in 2019 and 3.6 percent in 2020; which is, respectively, 0.2 and 0.1 percent less than the forecast of last October.
The issue has been clarified even more in the briefing of IMF Managing Director Christine Lagarde. She said, “After two years of solid expansion, the world economy is growing more slowly than expected and risks are rising.”
Maybe it doesn’t mean that a global recession is about to happen; but undoubtedly a sharper decline can be seen in the global growth.
AFRICA’S DIGITAL VISION FOR ADVANCEMENT
Africa is expected to jump ahead taking the advantage of technologies of the Fourth Industrial Revolution like AI and blockchain. “We’ve got the skills, we’ve got the technology, we should now have the courage to be ahead of the curve,” said South Africa’s President Cyril Ramaphosa.
VISIONS SHAPING THE FUTURE OF EUROPE
Three political leaders discussed their vision which are outlined for the future of the Europe.
Italy’s Giuseppe Conte said that his country would give more power to the people in order to counter a sense of despair amongst the middle classes.
Spain’s Pedro Sánchez urged delegates to keep in mind that the economy should always stand for giving better service to the people.
However, Germany’s Angela Merkel provided a strong defence of the global institutions, reminding people of how much development has been made over the past 50 years.
NEW ZEALAND HAS A WELFARE BUDGET
Jacinda Ardern unveiled a new approach to running New Zealand’s finances. In the explanation of the approach, she clarified that the child poverty figures will be presented at every budget in practical terms. The responsibility will be on ministers to show how the spending proposals will benefit people, and work with other ministers across party lines to ensure they have a positive, long-term impact.
“We need to address the societal well-being of our nation, not just the economic well-being,” she said during a relevant discussion.
This statement of her has indicated that from 2019, New Zealand’s government will present a “well-being budget” in order to scale the long-term impact of policy on the eminence of people’s lives.
DATA PRIVACY MATTERS EVEN MORE
In this age of tech revolution, advanced computing technologies have made it possible to automatically record and organize all the data that workers knowingly or unknowingly give to companies & the government and to store these data in credit union vaults. Already, the MIT Trust Data Consortium has built and demonstrated trial versions of such systems. Almost all credit unions already manage their accounts through regional associations that use common software. So, there’s the chance of widespread data deployment.
The meeting observed the call for a new system for the oversight of data use from government officials like Japanese Prime Minister Shinzo Abe; as well as the leaders of Salesforce, Microsoft and Apple. Microsoft CEO Satya Nadella and Apple CEO Tim Cook also publicly called for more awareness in guarding data privacy.
CONCLUDING REMARKS
Davos 2019 has clearly focused on the emerging world issues that are needed to be taken care of. All that the world leaders need to do is to bring transformative changes to prove the spirit Davos has tried to disseminate. In this era of the Fourth Industrial Revolution, these transformations can change the whole game of different kinds of work patterns – shaped by advanced technologies.
