World Economic Forum: Davos no longer understands the world

Powerful people from politics and business will meet for one week at the World Economic Forum in Davos. The general uncertainty is particularly affecting them this year.

“What is the mood?” – that’s what people ask here, in Davos. And hardly anyone answers that with really convincing optimism anymore. For some, the politicians, it’s because everything is already blowing up in their faces. They try to be confident, but clearly don’t really believe it anymore. For others, company bosses and economists, it is less about the current situation and more about the expectation of what is to come. Although one can hardly speak of expectation. If anything, it’s the uncertainty that’s driving everyone crazy. And there are many reasons for that.

First of all, there is world politics. Clearly she has taken over the World Economic Forum in these five days. Despite all the stories of war-weariness, the war in Ukraine plays a major role, probably also because President Volodymyr Zelenskyj came to give one of the most-attended speeches. He has to campaign for support again. “Every reduction in aid prolongs the war, every support shortens it,” he shouts to the packed hall. Before his speech, he meets company bosses who are expected to invest in Ukraine and Western allies such as US Secretary of State Anthony Blinken and NATO Secretary General Jens Stoltenberg. But he himself notices that the pressure is increasing, that more and more people are asking him how this war should end. He doesn’t have to give a convincing answer, people still stand up after his speech, but he can’t be sure whether that will still be the case next year.

A new major topic is the conflict between Israel and Hamas with all its possible effects on the region and the global economy. Many important politicians are here to talk about it – on stages, but especially on the sidelines during internal discussions. Israeli President Isaac Herzog is also there. He says: “The Israelis have lost their trust in the peace processes because they could see that terror was being glorified by our neighbors.”

“You can’t always say: you have to start”

German Foreign Minister Annalena Baerbock will speak on a panel with, among others, Saudi Foreign Minister Prince Faisal bin Farhan Al Saud. Both advocate a two-state solution. Baerbock speaks of an obligation for all other states to find a solution to the conflict. “You can’t always say: You have to start,” she says, referring to the conflicting parties, which ends in a vicious circle. But in conversations with German politicians you also notice that they themselves don’t know how a solution, ideally a two-state solution, can be achieved. And so the world looks at Gaza in perplexity.

Also because there is this man who could change everything in the fall – and because of whom we would like to solve as many crises as possible beforehand. Trump’s possible re-election is hanging over the world like a sword of Damocles, said US economist Kenneth Rogoff on the sidelines of the meeting. The re-election of Donald Trump is worrying many people here. Nobody really knows what the world – and the global economy – will expect if Trump becomes president again, but one suspects: nothing good.

In addition to the world situation, there is only one topic that similarly fascinates people in Davos: artificial intelligence. Before the events where Sam Altman speaks, people jostle to get a seat. While many of those present primarily want to talk about the technology’s opportunities and are very optimistic, the OpenAI boss speaks very clearly about the uncertainties that come with artificial intelligence: “I have a lot of understanding for the excitement and unease of many people against us ” he says on a panel. But he is convinced that the risks can be managed.

So these are the topics that people in Davos are dealing with. Isn’t there still one thing missing? Exactly! Germany. This no longer plays a major role for the majority of those present; instead, it is about China, the USA, India and the Gulf states. Nevertheless, there are of course some German company bosses there: Oliver Blume from Volkswagen, Christian Sewing from Deutsche Bank and Martin Brudermüller from BASF, for example. In addition to the Foreign Minister, Economics Minister Robert Habeck, Finance Minister Christian Lindner, Chancellor Wolfgang Schmidt and Education Minister Bettina Stark-Watzinger are also present from politics.

What is particularly noticeable is a duel between Christian Lindner and Robert Habeck that was not played directly. While the economics minister is talking about investments in transformation, the finance minister explains on stage: “I’m worried that some European politicians want to follow the USA with their subsidies. We can’t afford that.” Whether “many European politicians” are in their own cabinet? What happens next with the German economy also depends on the dispute between the two men (and parties) over the right economic policy. And it’s far from decided.

This article appeared first in the business magazine “Capital”which, like stern, is part of RTL Deutschland.