Publications /
Opinion

Back
The Tribe of Davos Globalists Feels the Downturn of Globalization
Authors
January 23, 2024

The annual World Economic Forum took place in Davos, Switzerland, from January 15-19. Every year for 54 years, a global business elite has traveled there, whether to interact with customers and suppliers, with intellectual leaders on broad topics or, in an informal environment, with the representatives of governments and multilateral authorities who attend.

Nothing is deliberated, of course, but over time the forum has established a reputation as a stage from which announcements are made and better cross-knowledge of the opinions of key people on hot topics can be obtained.

I personally had the opportunity to see this at the forum in January 2003, when I was a member of the Brazilian government delegation. At that moment, there was enormous and widespread interest in knowing what the first Lula government would be like. Rarely in my life have I seen such a large group of world-renowned economists sitting in a room to listen to the then-newly appointed Minister of Finance, Antônio Palocci, and President of the Central Bank, Henrique Meirelles, talk about their policy plans. Lula also received a huge spotlight at the event. The forum clearly served to satisfy this type of curiosity.

Xi Jinping, president of China, for example, knew how to use Davos well to defend globalization and free trade in 2017. China managed to climb the per-capita income ladder by taking advantage of globalization and, at that moment, it began to have to deal with the anti-Chinese attitude taken by the then Trump Administration. There could not be a better stage for delivering his message.

This year the official motto was ‘rebuilding trust’. It is no coincidence that geopolitical risks dominated discussions, from the wars in Gaza and Ukraine, to the possible consequences of Trump’s return to the White House after this year’s American elections. This was despite some kind of optimism that could have been generated by the favorable surprises in the global economy in 2023, after the predictions made at last year’s forum, when the dominant view—later contradicted—was that the global economy would go through strong deceleration. The need for more ‘trust’ and cooperation to mitigate global risks was the motto.

In January 2003, there was also the shadow of geopolitics. The possibility of an invasion of Iraq—which happened two months after the event—was the subject of discussions. The memory of September 11, 2001, was also fresh enough to appear in discussions. But the fact is that the predominance of the economic globalization agenda was then crystal clear.

Not this year. The 2024 Global Risks Report proposed by the Forum highlighted 10 main risks for the next 10 years. Five of these refer to environmental issues:

1- Extreme weather events;

2- Critical change in Earth systems;

3- Loss of biodiversity and ecosystem collapse;

4- Scarcity of natural resources; and

5- Pollution.

 

The report remarks that such environmental risks can exceed points of no return (‘tipping points’). In addition, the report highlights growing political polarization, technological risks with artificial intelligence evolving beyond the reach of regulatory controls, and new security risks accompanying the rise in geopolitical tensions. These themes predominated, at least judging by the open online sessions that I attended.

The Davos Forum is a giant in-person networking opportunity. The ebb during the pandemic hasn’t changed that. But something seems to have changed regarding what political scientist Samuel Huntington described in 2004 as a tribe, a global elite with “little need for national loyalty, [...] seeing national borders as obstacles that are fortunately disappearing and national governments as residues of the past. In other words, he described men – and – women of Davos as a tribe of “globalists”.

The Davos Forum is so identified with the expansion and strengthening of globalization in the decades in which it flourished, that it could not emerge unscathed from globalization’s partial retrenchment in recent times. Fears about deglobalization must have been predominant.

It is still paradoxical that, in addition to the smaller presence of globally significant public authorities compared to previous forums, the event had a speech by the new president of Argentina, Javier Milei, in which he warned the men and women of Davos about the risks of being captured by a worldview that “leads to socialism and, consequently, poverty”. Milei sounded how many far-right people have characterized … the ‘globalists’, like the people who attend the World Economic Forum at Davos. It must have been odd for Davos globalists to receive such a message.

RELATED CONTENT

  • Authors
    Inkyo Cheong
    Lillyana Daza Jaller
    Siwook Lee
    Jean-Christophe Maur
    Martin Molinuevo
    Sahar Sajjad Hussain
    Pierre Sauvé
    Shane Sela
    Aleksandar Stojanov
    Iryna Klytchnikova
    Edited by Pierre Sauvé and Uri Dadush
    May 23, 2023
    The broad thrust of Morocco’s trade and industrial policies over the last thirty years has been to anchor Morocco into world flows of goods, services, and cross-border investment. Despite the challenges posed by the COVID-19 pandemic, rising international prices, and a complex geopolitical environment, Moroccans continue to derive significant benefits from their economy’s openness. These include improved consumer choice and welfare, the growing insertion of Moroccan firms into cross ...
  • Authors
    May 22, 2023
    The current banking crisis in the United States began with the Silicon Valley Bank (SVB) run in March 2023 and was followed by other bank failures, raising concerns about the health and stability of the financial sector. This Policy Paper traces the root causes of these bank failures and examines the U.S. monetary policy decisions during this period. These bank failures were caused by the poor risk management practices of the failed banks, the sector’s weak regulatory structure, and ...
  • Authors
    May 19, 2023
    Earlier this month, U.S. Treasury Secretary Janet Yellen told congressional leaders that the government could run out of cash as early as June 1, if the debt ceiling is not raised in time. In January, the Treasury reached the current legally established ceiling in nominal terms ($31.46 trillion). The funds currently available to make government payment flows tend to exhaust by the end of this month. According to the Treasury Department: “Failing to increase the debt limit would ha ...
  • May 18, 2023
    Le Policy Center for the New South (PCNS) et le Fonds Monétaire International (FMI) ont organisé, le 28 avril, à Rabat, une table ronde d'experts sur le thème "Fighting Inflation and Building Resilience : the Outlook for MENA and Morocco". Au niveau international, la lutte contre l’inflation constitue la principale préoccupation des politiques économiques dans la majorité des pays. La détection des risques inflationnistes a pris du retard après la crise sanitaire parce que les aut ...
  • Authors
    Abdelmonim AMACHRAA
    May 17, 2023
    Nothing better illustrates the positive contribution of the integration of national economies into global value chains than the fact that in the 1990s, the automotive sector barely existed in Morocco. Now, it is the leading export sector, with a production and assembly capacity of 700,000 vehicles, making it an attractive and competitive hub linking Africa and Europe in the automotive value chain. However, the automotive industry is on the cusp of change, with advances in electric a ...
  • Authors
    May 15, 2023
    In the face of oil production cuts by Saudi Arabia and some OPEC members, the energy supply is shrinking again. This is in response to fears of an impending recession, higher inventories in some key countries, and an attempt to keep prices at a certain level. Turning to renewables is now essential to reduce dependence and increase resilience to energy insecurity, while non-renewable energy sources continue to show signs of unpredictability and harmful dependence. Economic outlooks v ...
  • Authors
    May 11, 2023
    This paper aims to investigate the impact of an inflation targeting framework adoption by the central bank, on the reduction of public debt ratios in emerging countries, through the potential discipline-enhancing effect of inflation targeting on the conduct of fiscal policy in general. The impact evaluation method used is the Propensity Score Matching (PSM), which allows the evaluation of the treatment effect of inflation targeting on fiscal discipline, in terms of public debt reduc ...
  • May 9, 2023
    La transition énergétique et écologique (TEE) est inéluctable, souhaitable et désormais acceptée au plan mondial. Mais le financement de cette transition demeure fort incertain. L’objet de ce Policy Paper est d’analyser les besoins de financement à considérer, et de passer en revue les différents canaux financiers possibles. Des pistes ont déjà été lancées, des procédures et des instruments sont mis en place, mais tout cela reste insuffisant. Il va falloir combiner un grand nombre d ...