Declining credential

In its 50-year history, the World Economic Forum (WEF), founded in 1971, has never been confronted with such an unprecedented global issue as it now faces in 2022, as the world recovers from a global pandemic, grapples to contain the devastating impact of the climate crisis, and navigates a geopolitical storm following the invasion of Ukraine. This week (May 22-26), around 2,000 business and political leaders have met, in person, at the WEF 2022 annual meet in Davos.

The issues to be discussed during the WEF annual meet included, among others, government policies and business strategies against the backdrop of the global pandemic, the war in Ukraine, geo-economic challenges-shifting geopolitical influence, combating climate change and protection of biodiversity.

Russian business and political leaders were barred by organisers from attending this year's gathering over the war. The Ukrainians have transformed the 'Russia House' in Davos – normally used by the Russian delegation – into the "Russia War Crimes House" to promote their cause.

"Davos will be different, but not mainly because of the lack of snow but because of lack of global cooperation to solve these most pressing challenges," Børge Brende, President of the WEF, said in a pre-event briefing. "Global challenges need global solutions, and we're not seeing these global solutions and that's where we have to push at Davos", he added. The catchphrase and theme of the meet were 'Working Together, Restoring Trust' and 'History at a Turning Point: Government Policies and Business Strategies', respectively.

Trust — the backbone of all the economic and social transactions — is in real crisis across the globe. A section of political analysts believes, 'Davos is dead', as the policy choices made by governments and international institutions throughout the pandemic have fallen woefully short of protecting people from the impact of multiple crises. Spiralling inflation, sky-rocketing energy bills and fuel prices, as well as high and still rising food prices, spelled disaster for so many. But the richest few, who continued to increase their wealth in the past two years, are still benefiting from the crisis. As a result, questions are being raised on the morality of an economic system that has failed to help the masses and instead supercharged inequality during a global health emergency.

Genesis of WEF

During the turbulent years of the late 1960s and the early 1970s, two organisations in Europe, created by a few business leaders and intellectuals, have played a very significant role in shaping the global political economy. The first one, the Club of Rome — a network of liberal world improvers — was initiated in 1968 by the Italian Fiat industrialist Aurelio Peccei and the Scottish chemist and energy researcher Alexander King. The other one is the World Economic Forum (WEF) which was initiated in 1971 by Prof Klaus Schwab and his secretary, Hilde Stoll. That year, they organised a European executives' symposium in wintry Davos for at least 440 participants. The entanglement of business, economics and good governance, combined with marketable environmental and social reforms, became one of the hallmarks of the foundation which, after the first successful symposium in 1971, was listed as the European Management Forum.

It is claimed that the intellectual activities of the Club of Rome had significantly influenced the Davos symposium from 1973 at the latest — when the Club of Rome presented its 1972 report, 'The Limits to Growth'. The report, written by scientists at Massachusetts Institute of Technology (MIT), projected a gloomy picture of the future in the midst of the international turnaround towards environmental sensitivity and economic downturn.

In 1987, the organisation (the European Management Forum) was renamed as the World Economic Forum, which pursued a dual economic and global policy dynamic. Firstly, the liberalization of international foreign exchange and capital markets was initiated, which promoted the globalization of the trade and financial system. Secondly, the beginnings of glasnost and perestroika emerged in the Soviet Union which, from 1989, would lead to an uncontrollable torrent of political upheaval in the Eastern Europe. Political scientist Francis Fukuyama analysed this development as "the end of history" as the end of systemic contradictions, which were then appearing in the assertion of a social system based on democracy and market economics.

In the early 2000s, euphoria as well as criticism about globalization was at its peak as the world economic powers generated their own countervailing power. Thus, the World Social Forum (WSF), held from 2001 onwards in Porto Alegre, Brazil, explicitly saw itself as a reaction to this and as an alternative to WEF. In Davos itself, a countervailing power succeeded to create a critical counter-public with a "Public Eye on Davos." In Porto Alegre, at WSF or the "other Davos", it was agreed that economic globalization must benefit all and be co-shaped by the people of the Global South. "Improving the state of the vulnerable world" was the creed of the counter power, with which it pressured the states of the North and opposed the arrogance of the economic powers.

Nevertheless, the agile World Economic Forum has long since learned to deal with anti-hegemonic criticism; its 'Open Forum' welcomes civil society and there are environmental, social and gender agendas. Since 2017, criteria from the Human Development Index – developed by economists from the Global South – are integrated in the 'Global Competitiveness Report' (WEF, 2018). Today's WEF reports, with sections covering 'Inclusive Growth', 'The Future of Jobs and Skills in Africa', 'Value in Healthcare', and 'The Future of Humanitarian Response' can easily be confused with reports from various UN agencies.

For decades, WEF and its founder Prof Klaus Schwab have set the agenda for the global economy and governance though WEF has no democratically elected representatives. Schwab's book, 'The Fourth Industrial Revolution' (2016), a bestseller, has been translated into 30 languages. According to the author, the fourth industrial revolution is characterized by a range of new technologies that are fusing the physical, digital and biological worlds, impacting all disciplines, economies and industries, and even challenging ideas about what it means to be human.

Key issues deliberated at WEF 2022

⁕ Russia-Ukraine war and its fallout on global energy and food supply was the dominant issue during the WEF 2022 meet. It seems NATO and its European members are desperately trying to come out of the mess as early as possible. Speaking at Davos, US statesman Henry Kissinger has even suggested that Ukraine should give up territory to Russia to bring an end to the invasion, and that the West should refrain from seeking an embarrassing defeat for Russia because that would further destabilise the world order.

⁕ The executive director of the International Energy Agency and the president of COP26, the United Nations 2021 forum on climate change, have warned against countries investing in fossil fuel infrastructure in light of shortages caused by the Russian invasion of Ukraine. Speaking during a joint interview with Al Jazeera on the sidelines of the World Economic Forum in Davos on Monday, Fatih Birol and Alok Sharma both expressed hope that the ongoing Russian attack on Ukraine, and the international energy crisis it has sparked, would boost the promised transitions to renewable energy. Birol described the current situation as "the first global energy crisis" the world has faced. "In the 1970s for example, we had an oil crisis…but it was only oil. Now we have oil. We have natural gas. We have coal – because Russia, the country that invaded Ukraine, was the number one oil exporter of the world, number one natural gas exporter of the world, and a major player in the coal market. So, it's a huge energy crisis with possible implications on the global economy," he said.

⁕ A two-year initiative to transform how the world manages water has been launched at the World Economic Forum in Davos. Singapore Senior Minister Tharman Shanmugaratnam, who was also co-chair of the global commission on governing the use of water, said that the aim was to mobilise changes in government and finance, and scale up innovations that can ensure access to water everywhere. He added that the world will have to spend about USD 300 billion a year to solve the problem, but neglecting it would cost much more in terms of livelihoods loss and wastage.

⁕ As on the previous occasions, this year also, Oxfam International has laid the data before the global leaders on how effectively the existing system has created more numbers of billionaires at the expense of millions of people who became poorer. According to them, more than 260 million people could plunge into extreme poverty this year because of skyrocketing inflation while hundreds have become billionaires whose cumulative wealth rose 30 per cent. "The single-most urgent and structural action that governments must take now is to implement highly progressive taxation measures that in turn must be used to invest in powerful and proven measures that reduce inequality, such as universal social protection and universal healthcare," the report said.

⁕ The head of the United Nations World Food Programme (WFP) has appealed to the billionaires, it's "time to step up" as the global threat of food insecurity rises with Russia's war in Ukraine. Meanwhile, the head of the WTO warned that the world's food crisis could last until 2024 unless safe corridors are created to move Ukrainian food stocks currently blockaded by Russia.

⁕ WEF President Børge Brende said that he has a lot of confidence in China's economy. With China's opening-up policy, continuous optimization of the business environment for foreign companies, and strong economic resilience, it will remain a hot place for investment, said global experts at the World Economic Forum (WEF) 2022 in Davos, expressing confidence in China's economic outlook.

India in Davos

Mukesh Ambani – Chairman and Managing Director of Reliance Industries Ltd is one of the members of the WEF Board of Trustees. India has sent a large delegation to the World Economic Forum's annual meeting this year. In addition to Commerce & Industry Minister Piyush Goyal, Petroleum and Natural Gas Minister Hardeep Singh Puri and Health Minister Mansukh Mandaviya, the Indian team included Chief Ministers and senior ministers of Madhya Pradesh, Tamil Nadu, Telangana, Andhra Pradesh, Maharashtra and Karnataka. With nearly 100 participants and dozens of political leaders, India presented its position on critical global issues like the energy crisis, food security, and health equity at the Forum's 2022 annual meeting in Davos.

The Indian delegation also included several industry leaders like Sunil Mittal, Hari Bhartia, Anish Shah, Sanjiv Bajaj, Sumant Sinha, Adar Poonawala, and Pawan Munjal. They are mixing with young unicorn founders like Nikhil Kamath of Zerodha, Prashant Pitti of Easemytrip; Ashish Singhal of Coinswitch and Vidit Atrey of Meesho. This is the first Davos outing for many young entrepreneurs. In Davos, the government has proudly referred to the rise of unicorns (start-up companies with a value of over USD 1 million) in India.

It is reported that inside a pavilion on the Swiss Alpine Resort's Promenade Street beneath an "India @Davos 2022" logo, the federal government served up treats including 'masala chai' tea, 'samosa' snacks and other spicy delicacies. At the government's base, food was being prepared by a team of 15 chefs who were flown in from India, along with 450 kilograms of vegetables and local spices.

The WEF has launched the India chapter of the alliance of CEO Climate Action Leaders on Monday to supercharge India's climate action and decarbonisation efforts. As a part of the World Economic Forum's Climate Action Platform, the alliance will continue efforts to achieve the vision outlined in the white paper released last year — 'Mission 2070: A Green New Deal for a Net Zero India'.

The Indian conglomerate HCL has announced a partnership with UpLink — the open innovation platform of the World Economic Forum, which connects highly promising start-ups with the partners and facilitates the funding they need to scale. Through a USD 15 million investment over five years, HCL will accelerate the innovation agenda for water and create a first-of-its-kind innovation ecosystem for the global freshwater sector on UpLink.

Maharashtra, India's largest state in terms of GSDP, has joined the World Economic Forum's Global Plastic Action Partnership (GPAP) to drive localised solutions for the circular economy.

Minister of Petroleum and Natural Gas Hardeep Singh Puri claimed at the WEF meet in Davos that India will emerge as the leader of green hydrogen. "India is moving faster than any other country towards a green transition. We are taking advantage of the current energy crisis to accelerate this transition," Puri said at a breakfast interaction with members of the Indian diaspora.

The significance of WEF to Indian delegation can be gauged from the fact that the Maharashtra Department of Education has signed a Memorandum of Understanding with the Byju's Institute (an Indian company) at the World Economic Forum to provide modern education to the students of the Brihanmumbai Municipal Corporation.

Conclusion

Three years ago, Dutch historian Rutger Bregman went viral at a Davos panel when he called out billionaires for tax avoidance. In a clip that has now been viewed nearly 11 million times, Bregman said that a global failure to effectively tackle tax avoidance was the primary cause of inequality. "It feels like I'm at a firefighters' conference and no one's allowed to speak about water," Bregman said at the time. "This is not rocket science … We have got to be talking about taxes. That's it. Taxes, taxes, taxes."

People are no longer fooled by the Davos talk of equality, transparency, respect and diversity. They are well aware that those who benefitted and continue to benefit from the pandemic that left them struggling to put food on their table have gathered in Davos to discuss strategies to earn more wealth in coming years. People want to see accountability in domestic policy – in tax policy in particular. Serious tax reform proposals that are gaining momentum, such as a Global Asset Register (the proposal to create a comprehensive international registry of all wealth and assets), or the creation of a UN tax convention, did not find political backing at Davos. A much-needed reform of multilateralism has also not begun.

Protestors, activists and people on the frontlines of inequality have sought to challenge the WEF over its "empty rhetoric," accusing Davos of representing "a symbol of a failed era" that should be left behind. The observation of an activist after participating in the Davos meet probably reflects the sentiments of millions of people around the globe. She said, "I have already come to the conclusion that the world would be a better place if the WEF didn't exist".

Emergence of China as a major global power has made organizations like WEF increasingly irrelevant though Klaus Schwab has proudly claimed, during the inauguration of the World Economic Forum's 2022 Davos meeting,

that "the future is built by us"! The outcome of the meet suggests that WEF has lost its credibility and relevance. The world is no more a unipolar one as envisaged by few political scientists, rather we might be looking at the 'regionalization of globalization'. In a multipolar world, with strong regional centres, WEF may have to confine itself to its initial role as a former euro-centric lobby — the European Management Forum, that served as a platform to nurture and boost the aspirations of European business and political elites.

Views expressed are personal