This week sees the annual World Economic Forum in Davos, Switzerland, the yearly meeting of world and business leaders. ‘Davos’ started 47 years ago when Klaus Schwab, a German professor, invited 444 business leaders to what was then called the ‘European Management Forum.’ Today it is a far grander affair: so who is going? What do they talk about? And what does it mean for you and me?
Well, I have been through the post three times: checked my e-mails. Even had a look on Snapchat. And it has not arrived. Maybe it is lost in the post. Or maybe someone has just made a mistake. But for yet another year I have not received an invitation to the World Economic Forum, the annual meeting of the world’s great and good in the Swiss resort of Davos. It starts tomorrow: there will be speeches, meetings and a week’s worth of headlines. But what does it all mean? In fact, does it mean anything at all? Or is it just a week’s jolly for the fattest of fat cats – after all, this year Donald Trump is going, and he will only be the sixth-richest person to speak.
A bit of background
Davos is a mountain resort in the eastern Alps region of Switzerland: every January, it plays host to the World Economic Forum, a meeting of around 3,000 top business leaders, political leaders, economists, journalists and a few assorted celebrities. The Forum started in 1971 as the European Management Forum – and having upgraded itself to the World Economic Forum in 1987 has been attracting increasing numbers of delegates and increasing column inches ever since.
So who is going this year?
The World Economic Forum proudly boasts that this year it will bring together a record number of heads of state, government and international organisations, alongside leaders from business, civil society, academia, the arts and media. And there they all are Donald Trump, Angela Merkel, Emmanuel Macron and our very own Theresa May. Plus leaders from around the world and not forgetting President of the European Commission and well-known member of the Temperance League, Jean-Claude Juncker.
Last year Chinese Premier Xi Jinping went for the first time and roundly condemned the newly-inaugurated President Trump’s plans for protectionism – imposing import tariffs on goods not made in the USA. This year Xi will be staying at home and China will be represented by Liu He, economist and member of the Central Committee of the Communist Party. He may be busy: plenty of leaders of smaller countries will want to discuss China’s One Belt, One Road initiative with him.
…And also in attendance will be self-confessed Marxist and Labour shadow chancellor, John McDonnell. At first, it seems an odd move for someone who lists the ‘overthrow of capitalism’ as one of his hobbies. But of late, McDonnell has been on a charm offensive, seeking to persuade business that a Labour Government would not be quite as hostile as the Daily Mail is suggesting. Presumably, Davos will see him take the same message to an international audience.
What do they talk about?
Every year the conference has a theme. Last year it was ‘Responsive and Responsible Leadership:’ this year it will be ‘Creating a Shared Future in a Fractured World.’
In theory, the delegates discuss the most pressing issues facing the world economy. Inevitably some leaders will make whatever points they want to make, but there are a wide range of very worthy topics discussed. It is easy to be cynical: in 2016 delegates gave Leonardo di Caprio a warm reception as he railed against corporate greed and global poverty – and then went off to drink £290 bottles of Cheval Blanc.
But let us try and put that to one side: this year the ‘Davos men’ (and women, who make up about 20% of the attendees) will hear how AI algorithms might be used to prevent suicide, the future of healthcare and – worryingly – why geopolitical risks will keep you awake in 2018. And in a talk with a title that might have been written for Google, the Rocket Man himself will describe 5 Leadership Lessons from my Darkest Hours.
OK, you have convinced me. How much does it cost to go to Davos?
By World Economic Forum from Cologny, Switzerland [CC BY-SA 2.0], via Wikimedia CommonsDavos certainly isn’t cheap. Tickets cost around £22,000 and even travelling there is expensive. Bluntly, the only real way to arrive is by helicopter, which will add another £7,500 to the bill. Oh, and even the most miserable room in a 3* hotel is £500 a night while hiring a chalet for a bit of Davos team building (assuming you have bought a corporate membership for £500,000) will be well into six figures. Then there’s the designer thermal underwear…
So it is really all about business?
Increasingly, the answer is yes. One corporate CEO has said that he and his colleagues will have more than 100 client meetings over the 4 days of the Forum: for FTSE-100 and Fortune 500 companies, the business you can do at Davos turns the cost of attending into petty cash. And increasingly deals are being done away from the main conference – with a Davos ‘fringe’ springing up as companies take over storefronts and arrange private seminars and parties. And why not? The delegates at Davos are a concentrated, highly focused target market with – between them – some of the biggest purchasing power on the planet. For a CEO, Davos is the place where he can get the most done in the shortest time. After all, there’s not just the ticket and the chalet to pay for: even a hot dog in Davos is £30…
What does this mean for you and me? And our money?
Irrespective of the headline themes at Davos, major economic trends will be discussed – formally or informally. In 2016 it was the global economic slowdown, last year plenty of meetings will have centred on the impact of Brexit and this year there is a year of President Trump to discuss.
But will Davos affect your mortgage rate? How much interest you receive on your savings? No, it won’t. The Washington Post even went so far as to ask ‘Does Davos matter any more?’ in a recent headline. But whether it matters or not, the World Economic Forum will continue to attract column inches and coverage out of all proportion to its relevance to everyday life. But then again, Elton John has previous for duets with leading ladies. Who cares about economics when he might invite Theresa May on stage…