Davos 2012 ends with euro hopes, but amidst economic uncertainty
- 29 January 2012
- From the section Business
The World Economic Forum in Davos has ended with worries about the economy, but hopes that the eurozone crisis is under control.
Economic issues dominated this year's five-day meeting of the world's rich and powerful in the Swiss mountains.
But business leaders were more optimistic about the future than the economists and political leaders.
Inequality and youth unemployment were also discussed, egged on by protests from the Occupy WEF movement nearby.
Eurozone governments and the European Central Bank had made a good start on tackling debt and problems in the financial sector, said Vikram Pandit, chief executive of US banking giant Citi.
Both German Chancellor Angela Merkel and UK Prime Minister David Cameron restated their conflicting positions on how to tackle the economic crisis, indicating little movement.
Overall, though, not only eurozone politicians, but also bankers and business leaders said there were clear signs that the crisis was coming under control.
Poland's President Bronislaw Komorowski said the crisis could be "overcome if we have the courage".
Indeed, while the forum had started in a gloomy mood, with economists, bankers, financial regulators and many investors predicting that Western economies would have 10 to 15 years of slow or no growth, sentiment turned on Thursday afternoon following good economic data from the US and the emergence of a consensus among eurozone governments to tackle the crisis.
Worries, and optimism
Despite this, throughout the five days of discussions there were warnings of economic uncertainty ahead.
The managing director of the International Monetary Fund, Christine Lagarde, warned the Davos leaders that this was "not just a eurozone crisis, it's a crisis that could have... spillover effects around the world".
"What I have seen and what the IMF has seen in numbers and forecasts is that no country is immune and everybody has an interest in making sure that this crisis is resolved adequately," she said.
Business leaders, though, were optimistic, even bullish, given their expectations of strong growth in emerging markets. During the coming years, tens of millions of people across Asia and Latin America would be lifted out of poverty and join the middle class, driving strong domestic demand.
While the forum's annual meeting attracted a record 2,600 leaders from the worlds of business, politics, media and academia, there was a notable lack of big hitters.
Also missing were the big debates and announcements that had made the forum a top agenda setter in past years.
The exception was Microsoft co-founder Bill Gates, who once again used the Davos event for a rallying call to fight malaria, Aids and tuberculosis, and announced that his and his wife's foundation would donate $750m to the Global Fund to help in this campaign.
"These are tough economic times," Mr Gates said, "but that is no excuse for cutting aid to the world's poorest".
Still, the event felt flat at times, at least compared to previous years. Unlike journalists, Davos participants did not feel deflated and got down to what the event really is about: soaking up new ideas, pitching deals and - most importantly - using the opportunity to network.
The top 1%
Davos is most certainly a meeting of some of the world's "top 1%", as the Occupy protesters like to call them, and there were several small protests outside the heavily protected venue, which was surrounded by hundreds of Swiss police officers, security guards and soldiers.
Plans for a meeting between the forum's founder, Prof Klaus Schwab, and representatives of the Occupy WEF movement fell apart, though, amidst wrangling over where to meet.
Despite this, the Occupy movement featured prominently in the discussions, with many business leaders at least claiming that it was unsustainable not to tackle the growing inequality in the world.
To broaden discussions, the forum invited a new range of young voices to challenge business and political leaders.
Called "Young Shapers", they ranged from Giorgio Jackson, one of the leaders of the recent student protests in Chile, to Howard W Buffett, who runs a foundation focused on improving the lives of the most impoverished populations (and also happens to be the grandson of the world's third-richest man, fabled investor Warren Buffett).
Davos certainly discussed many of the most urgent issues of the world.
Yasuchika Hasegawa, chief executive of Japanese pharmaceutical giant Takeda, called it "a great place to learn".
But he also admonished his peers that they needed "not just to talk, we need to implement, we need to commit to save the world", and pledged that, when he returned home, "I'm going to do something."