What attracts Davos?

WHAT IS it that draws so many corporate moguls, political titans and government luminaries, more than 2,300 this year, on this annual pilgrimage to the small mountain retreat called Davos, located in the Swiss Alps?

The great and good, the high and mighty, come here to talk among themselves in not-quite-splendid isolation. The World Economic Forum attracts, year after year, the world's political and business elite, personifying its pre-occupations of power, prestige, celebrity and money.

This Alpine resort in itself is non-descript and hard to reach, even if one's journey is by private jet and helicopter. The hotels are often cramped. But for the richest and most powerful people on the planet, Davos remains the hottest of tickets for the simple reason that so many of their ilk are here, too. The forum has its critics, but, above all, it has critical mass.

Ostensibly, the purpose of attending is to participate in several hundred public and semi-public brainstorming sessions that run the gamut of government and corporate policy concerns. In practice, much of the real business at this week-long gathering takes place in private meetings in hotel rooms where deals that may soon move markets for millions can be struck. For the chief executives of the world's multinationals, Davos is, to borrow the language of the Palm Pilot organisers so many of them carry, the ultimate `hot-synch'. A means of plugging their own interests and assets into a global network.

The cast for this year's event lacked the starry quality of 2000, the forum's 30th anniversary, when Mr. Bill Clinton stole the show, with Mr. Tony Blair in his high-powered supporting act. But the attendance list testifies nonetheless to Davos's enduring appeal. Among the business moguls who took part were Microsoft's Bill Gates, Dell's Michael Dell, and Mr. Douglas Daft, the boss at Coca-Cola. About 40 heads of state and government flew in along with Mr. Kofi Annan, Secretary-General of the United Nations, Mr. Yoshir O. Mori, Prime Minister of Japan, Mr. Viktor Geraschenko, chairman of Russia's Central Bank, Mr. Yassir Arafat, the Palestine Leader, President Kostunica of Yugoslavia, and Mr. Larry Summers, erstwhile U.S. Treasury Secretary. There were academic heavyweights galore. Adding a sheen of glamour, a smattering of European royalty were King Carl Gustaf of Sweden and Queen Silvia, and Crown Prince Albert of Monaco.

It is not hard to see why the forum raises hackles and has become, like the International Monetary Fund and the World Trade Organisation, a focus for the anti-globalisation protesters who dissent from the existing economic order; it embodies everything the dissidents despise.

But unlike the WTO's disastrous shindig in Seattle in 1999, or the IMF's annual Washington meetings, Davos's remoteness means it is likely to prove a difficult place for hardliners and anarchists to stage violent protests at; there is only one road and one rail line into this Alpine village. The Swiss security presence was even heavier and high profile this year. For the first time in its 30-year history, the meeting was held behind barbed wire, barricades and huge police operation.

The theme of the meeting this year was `Sustaining Growth and Bridging the Divides: A framework for Our Global Future'. The object was to prompt discussion on the direction of the global economy. The issue of globalisation and its impact and the long term health of the international economy continued to dominate discussions. The new wave of Internet technology, biotechnology, corporate responsibility, and the integration of art and culture into everyday life also dominated many of the 300 sessions.

Some of the unusual topics on the programme included yoga for the hands, the end of Hollywood, the mystery of pain, and NGOs - ultimate global regulators? Regional outlooks for Europe and Asia also came under the spotlight.

But while the Davos glitterati basked in the aura of an all- powerful elite, there were anxieties dogging this year's gathering with their biggest pre-occupation - America's economic downturn, and the danger of a global slump. If the world's major economies are in for a few ups and downs this year, emerging markets `should prepare for the sharpest of roller-coaster rides' concluded one panel discussion. The slowing U.S. economy, reduced demand for foreign goods, falling FDI, and high oil prices were some of the problems facing emerging markets. Even the most optimistic panel speaker recognised that the volatility, political and financial risk inherent in many emerging markets would continue to be a key factor.

Speakers from India and Africa criticised institutions such as the World Trade Organisation and the International Monetary Fund for not properly tackling the needs of the poor countries. Existing trade agreements also often worked to the disadvantage of emerging markets, they said. ``Where is the voice of the poor? Proper representation of the poor is necessary," said Mr. Thabo Mbeki, President of South Africa. Ms. Vandana Shiva, an Indian ecologist and Director of the Foundation for Science, Technology and Ecology, said, ``A lot is wrong with our institutions." Developing nations, which account for 60 per cent of the world's population, received only 25 per cent of the total FDI flows, down from 38 per cent, three years ago", said Mr. Digvijay Singh, Chief Minister of Madhya Pradesh.

While few solutions were offered, there was broad agreement that improving international institutions and helping the poor is in the interest of both the industrialised world and emerging markets. The South African President asserted that ``the problem of the poor is also a problem of the rich. Globalisation has to work for everybody, if it is to be successful". That was the consensus.

The high point of the planet's most exclusive gathering came as a hard-hitting warning from the United Nations Secretary General, Mr. Kofi Annan. He echoed the feelings of many with the message of a `backlash and protectionism' because of the unequal distribution of benefits and the imbalance of global rule-making. ``That in turn", he said ``threatens to undermine and, ultimately, unravel the open world economy that has been so painstakingly constructed over the course of the past half century."

Good intentions surely filled the limousines and helicopters of the Davos crowd as they departed the dazzling Swiss mountain tops. The question is: will anything change, now that they have all gone home? India too was, as usual, represented by a top- level team, all of them `movers' and `shakers'.

They must not lose peripheral vision. They must stay engaged. They must not only focus on their next earning statement. They must find time to share concerns, think outside the box, and act, firmly and quickly!

Mohan Murti Director, CII Germany

(Views expressed are personal and do not reflect the views of the CII)

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