Davos' World Economic Forum gathering to focus on global governance
The dangers of the growing lack of clear global political leadership at time when global governance is drifting will be a major theme at this year’s Annual Meeting of the World Economic Forum in Davos.
There is a sense that the politicians handled the global crash of 2009 and 2010 better than expected, and have started to clean up some of the worst excesses from that time, but they have not yet moved on to chart how to manage the next few decades of global development.
And this year’s Annual Meeting will flag up a new urgency because it is not a time for inaction. Things are changing so fast that the old structures of global governance are failing, and it is becoming increasingly important that new institutions and new powers are found for successfully managing the multipolar world in which we not live.
The United Nations (which was established at the end of the Second Word War) is struggling to impose its authority on anything. At least the expanded G20 club of rich nations is a great improvement on the previous much smaller G8, but remains focused on the national management financial and business issues with no global authority. Global talks on climate change and free trade have stalled without much comment, and no one even mentions the Millennium Development Goals any more, however important they remain for the future of mankind.
The glory days of the pre-2008 boom are over, and the urgency of coping with the hectic panic of the 2008-2010 crisis has faded, leaving a curious absence of purpose as the world’s leaders take on board how much more complicated their relations have become in the multipolar world of today and the foreseeable future.
Not many have noticed how across the world the rapidly changing demographics in many countries is posing new strains (for example, Europe is ageing while the Arab world getting younger). And in many countries a rapidly growing middle class is finding its ambitions stifled by government spending cuts. These social frustrations combine with regional powers taking leadership on many issues, with the consequent likelihood that economic pragmatism and protectionism will lead to clashes and aggravate the vacuum in global governance.
Another important global risk the World Economic Forum has identified is the lost generation of the 2010s, as they face high unemployment and precarious jobs, which will harm their efforts to build a secure place in society. In the advanced economies young people are graduating with high debt and mismatched skills, while in developing countries more than two-thirds of youth are not being educated or trained to fulfil their full potential.
But whether they are from rich or poor economies, all these young people are digital natives and their troubled economic situations will only add to their disconnection from the traditional structures and politics. Their ambitions need to be recognised and harnessed to avoid them drifting into complete dislocation leading to systemic risk.
A further major global risk is the openness of the Internet, and the ease with which it can be attacked. Cyberspace has always been resilient, but the World Economic Forum points out that the world is only one disruptive technology away from attackers gaining a runaway advantage, meaning that the Internet would cease to be a trusted medium of communication of commerce. Some of what this Annual Meeting will be about its how to ensure that the Internet can be preserved and protected for the common good of having a cyberspace that can remain secure and trusted.
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