The theme of the upcoming World Economic Forum is "Mastering the Fourth Industrial Revolution" but despite the focus on transformative technology, much time will be spent churning over the "old" issues still plaguing the world such as the recent market volatility in China, oil prices, monetary policy divergence, terror risks and geopolitical tensions.
Gathering at the Swiss Ski resort of Davos on January 20th will be top figures in politics, business and showbiz from across the globe, including Secretary of State John Kerry, Prince Albert of Monaco, actor Leonardo DiCaprio, United Nations Secretary-General Ban Ki Moon and Jack Ma, the founder of e-commerce firm Alibaba. Other attendees will include Justin Trudeau, Will.i.am and Loretta Lynch, as well as the archbishop of Canterbury and representatives from Uber.
“Gathering at the Swiss Ski resort of Davos on January 20th will be top figures in politics, business and showbiz from across the globe.
According to Klaus Schwab, founder and executive chairman of the World Economic Forum, the conference will move along in three dimensions: economic, social and environmental issues such as how to implement the Paris climate agreement; the current geopolitical situation in the world; the fourth industrial revolution and its impact on governments, business and society.
Over the last year, a number of positive global developments took place including a landmark nuclear deal between international powers and Iran, the bringing of the deadly Ebola virus under control, a breakthrough in U.S.-Cuba relations and a global climate deal in Paris.
The past year, however, also saw several high-profile terrorist attacks on Westerners, a decline in oil prices and rising tensions between major powerhouses Iran and Saudi Arabia in the Middle East. These issues as well as the situation in China and the drastic selloff in Chinese equities will continue into the next year.
Equally worrying is the monetary policy divergence between the U.S. and Europe. As the Fed was tightening its economy by introducing a small interest rate increase, the European Central Bank was loosening the purse strings further in Europe, in a bid to stimulate growth and ward of deflation. This is expected to do well for the U.S. but would impact negatively on Europe.
Additionally, the question of the war in Syria which is entering its fifth year and the millions of migrants seeking asylum in Europe are issues adding to the political crisis there.
Forum Focus in Question
Many attendees at Davos are concerned that these matters could easily hijack the planned agenda whose focus should be on the fourth industrial revolution.
According to Schwab the world is not sufficiently prepared for the current industrial revolution “which will come over us like a tsunami [and] which will change whole systems.”
Ahead of the annual meeting, the WEF released its annual Global Risks Report which found that “large-scale involuntary migration” was the most likely danger facing the world in 2016. Around 60 million people were forcibly displaced in 2014, according to the United Nations. That’s 50% more than in 1940.
The report said that forced migration, whether due to violence, environmental or economic reasons, was strongly correlated with “interstate conflict and state collapse but also climate change and water crises and that the greatest potential impact in 2016 is a “failure of climate-change mitigation and adaption” despite the landmark climate change agreement in Paris late last year agreed by nearly 200 countries.
Many economist and regular Davos attendees support this year’s theme and point to the need for more investment in new technologies that can bolster current sluggish global growth and productivity growth. They believe that companies have been overly cautious on investing and trust that discussions regarding why that is and what will be done about it will take place at Davos.