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31/08/2016

Davos pitches ‘tech revolution’ in the face of mounting pessimism

Digital

Davos pitches ‘tech revolution’ in the face of mounting pessimism

HUBO, a multifunctional walking humanoid robot lifts a piece of wood in front of the logo on the opening day of the 2016 World Economic Forum meeting in Davos. Switzerland, Tuesday (January 19).

[World Economic Forum/swiss-image.ch]

The annual Davos meeting, which opens today (20 January) in the Swiss Alps, will look into whether the forthcoming technological revolution can bring renewed prosperity in times of overwhelming challenge and mounting gloom.

Held in a ski resort in the Swiss Alps, the World Economic Forum is known for being the thermometer of global affairs. But in this year’s edition, the mood is rather negative.

Echoing the organisers’ own report, consultancy firm PwC unveiled a survey on Tuesday (19 January) which found that CEOs are less optimistic about their future this year than last.

>>Read: Davos report warns of EU disintegration

According to a poll conducted among 1,409 business leaders in 83 countries, those who think that global growth will improve over the next 12 months have declined to 27% from 37% in 2015. The PwC study noted that, “against this tide of pessimism, CEOs in India (64%), Spain (54%) and Romania (50%) stand out as more optimistic”.

Against this backdrop, business leaders and politicians will ponder in Davos whether the new digitalisation wave applied to products, services and processes could serve as a catalyst to regain confidence in a more prosperous future.

The backers of techno-optimism will be led by the CEO of Microsoft, Satya Nadella, and the number two at Facebook, Sheryl Sandberg.

The two technology chiefs will set the tone for the forum on Wednesday (20 January), where the absence of key political leaders came as a powerful reminder of the numerous crises shaking the world today.

Debate with Schäuble and Tsipras

The German Chancellor, Angela Merkel, will be the main politican absent at Davos, as she struggles to cope with growing impatience over refugees among voters, and her own party members. Instead, Germany will be represented by Sigmar Gabriel, the Vice-Chancellor and Economy Minister, and Finance Minister Wolfgang Schäuble.

Schäuble, who questioned Merkel’s immigration policy, will participate in a panel discussion on Thursday (21 January) on the future of Europe. The German minister recently floated the idea of a petrol tax to cover the rising costs of the refugee crisis.

>>Read: EU considers petrol tax to pay for refugee crisis

It will be the first time that Schäuble will hold a public debate with Greek Prime Minister Alexis Tsipras since he threatened to push Greece out of the eurozone, in July 2015. French Prime Minister Manuel Valls, and Dutch Prime Minister, Mark Rutte, at the EU’s helm this semester, will also participate.

China and Iran

But Europe’s top brass is not only anxious because of the refugee crisis. There are also worries regarding turbulence in China. The Vice-President of China, Li Yuanchao, will try to reassure global leaders about the reforms implemented by the Chinese government to bring stability to its financial market and complete the transition to a domestic consumption model.

Meanwhile, Iran will send his top diplomat, Foreign Affairs Minister Mohammed Javad Zarif, and the President’s chief of staff, Mohammad Agha Nahavandian, in a charm offensive to attract badly needed investment to relaunch its dormant oil and gas industry.

Now that international sanctions are partly lifted, Tehran is looking for investors, particularly in Europe. According to some estimates, Iran could need up to €200 billion over the next five years. European governments and firms are already sending envoys to explore new agreements with Teheran, as Europe is the second largest importer of its oil and gas just behind China.

>>Read: Spain seizes on end of Iran’s sanctions with plan for joint refinery

The fossil fuels sector was the target of a rare harsh attack in the opening session, on 19 January. In contrast with the standard political correctness of the forum, Leonardo DiCaprio attacked the “greedy” corporations of the oil and gas industries for their denial attitude toward climate change over many years and its destruction of the ecosystems. “Enough is enough”, the actor turned into environmental activist said,-  “History will place the blame for this devastation squarely at their feet.”

DiCaprio, who was honoured for his work to protect the planet, is part of the glamorous and artistic side of Davos, where Bono and Kevin Spacey were also expected among the 40 heads of state and governments and more than one thousand business leaders.

Twelve European Commissioners will attend events at the the Davos conference, a spokesman said on Tuesday..

Timeline

  • 20-23 January: World Economic Forum in Davos, Switzerland.

Further Reading