Davos agenda: Asia, climate, poor
World's business elite wrestle with priorities at economic summit
Jan 25, 2006 - Saving the world was on the agenda, but for many of the business leaders, academics and activists who attended the "Big Debate" at the World Economic Forum, the theme may very well have been: Saving the West from China and India.
Foreboding hung in the air Wednesday as participants discussed key issues that global society must confront to navigate what Harvard University President Lawrence Summers described as one of the most important moments in history -- Asia's new economic might.
"What is happening in India and China ... the integration of the four-fifths of the world where people are poor with the one fifth of the world where people are rich, has the potential to be one of the three most important economic events in the last millennium, alongside the Renaissance and the industrial revolution," Summers said.
He cautioned the room of millionaires and leaders in their fields to focus their minds: "I fear that we have too much hope and too little fear."
But fear was a recurrent subtext -- at least in the words of the Westerners who comprised the majority of those present.
The debate -- like much of the goings-on at the 2006 edition of the annual Davos extravaganza -- reflected the realization by many that global integration and the wondrous technological advancements of recent years could bring traumatic change to countries that have grown comfortable and perhaps a little complacent.
Adding piquancy to the proceedings was Chinese government data coming from Shanghai earlier in the day that suggested China may have leapfrogged several European powers to become the world's fourth-largest economy, after the United States, Japan and Germany. (Full story)
Speakers at the debate noted that by embracing market principles, China and India have added hundreds of millions of inexpensive workers to the global labor market at precisely the moment when technology has rendered geographical location less important.
Laura Tyson, dean of the London Business School, warned of "downward pressure on real wages or employment (in the West) for a period to last up to 25 years."
The session -- a centerpiece of Day One at Davos -- reflected the extraordinary mix of idealism, business, networking and self-promotion that has made this annual gathering in a remote Swiss ski resort such an improbably huge event on the calendar of the world business elite.
Some delegates got up to note that their companies have created thousands of jobs in Africa and called on others to follow. Another got up to reveal that he was wearing smiley faces on his short to reflect his optimism.
At one table, delegates debated whether the global economic output might rise fast enough to prevent the need for an actual transfer of wealth from developed to developing countries. But solar power advocate and businessman Bertrand Piccard -- who became the first balloonist to circumnavigate the globe seven years ago -- urged colleagues to think more creatively, along undefined new lines.
Peter Brabeck-Letmathe, chief executive of Nestle, was more downbeat, saying that he once hoped for a truly global society but "the dream is over." He said regions of the globe were drifting apart, separated by competition over oil and water, by differing attitudes and age demographics.
Columbia University Professor Jagdish Bhagwati spoke in stark terms as well.
"Twenty percent of the population of the world has 80 percent of the income ... India and China are no longer willing to sit on the margins," he warned, calling for a more equitable distribution of wealth. "We have 40 percent of the world's youth."
Each of the fifty-odd tables picked a discussion leader who reduced their own debate to two key questions facing the world, which were written down on blue cards and submitted to the organizers, who in turn formulated the most common themes and submitted the batches of questions to an electronic vote.
The resulting big five?
"I think the questions that emerged are the right questions," Tyson concluded. "The issue is solutions coming from the business community."
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