Davos is a name many identify as a forum where prominent politicians, businessmen, celebrities, NGOs and activists are used to gathering every year to address world’s problems.
The World Economic Forum (WEF), former European Management Forum (EMF) was created by German Professor and Engineer Klaus Schwab in 1971. At that time the United States was facing the limits of its expansion, the stagnation of the Vietnam War and soon after the birth of the Group of Seven (G7), with the most important developed economies -Germany, France, Canada, the United Kingdom, Italy, Japan and the US- aimed at searching for consensus on world’s management.
All this seemed crucial due to the oil embargo perpetrated by the Organization of Oil Exporting Countries (OPEC).
The forum created by Schwab was in many respects an innovation and as opposed to the Bilderberg Club (born in 1954) and the Trilateral Commission (created in 1973), that were surrounded by secrecy, it promoted a more public debate about the political and economic challenges the world faced. In 1987 the European Management Forum changed its name to the World Economic Forum, an NGO, lobbying structure, and think tank, based in Cologny, Geneve, and financed by around 1 000 multinational corporations. Although the WEF is mostly known for its January annual meeting held in Davos each year, the forum sponsors regional meetings and conferences throughout the year plus a number of publications on global risks, the world economy, international security, and such.
The WEF began to have a prominent role in the promotion of dialogue and understanding in the 80’s and 90’s. For instance, both Nelson Mandela and Willem De Klerk gathered in Davos in 1992, the first time they did so outside South Africa. In 1994, during the annual meeting, Israel’s foreign minister Shimon Perez and the Organization for the Liberation of Palestine leader, Yasser Arafat, reached a preliminary agreement on Gaza and Jericho. It is believed that the WEF was key in supporting Boris Yeltsin against Gennady Zyuganov as President of Russia in 1996. One can also mention the participation of Henry Kissinger and Soviet leaders, plus celebrities from the world of the arts, music, like Bono, and activist like Greta Thunberg who spoke to world’s leaders and businessmen about poverty, debt reduction and the environmental crisis.
But as time went by, the WEF experienced accusations of mismanagement, corruption and other felonies by its CEO -Schwab- and other prominent members. Even though as recent as 2017, the President of China Xi Jinping addressed the forum, and the following year, India’s Narendra Modi delivered a keynote speech, the forum experiences a crisis of credibility. There were accusations that Schwab used the WEF for its own personal priorities. Then came the controversy over the “Global Competitiveness Index”, where apparently some countries were favored over others by using subjective criteria. Another scandal arrived when it was revealed Schwab intended to be paid for WEF publications that were financed with resources from the forum.
Yet the crisis of the WEF is the crisis of multilateralism, the lacking faith in institutions and disbelief in Global Governance. As recent events in Ukraine, Iran and Venezuela have shown, the big stick is back, soft power is diminished and powerful countries act in pursuit of their specific and selfish interests. Dialogue, cooperation, the respect of international law, the promotion of human rights and diplomacy seem to be forgotten for the sake of militarism, war, confrontation and the jungle law. Davos reached enormous success when countries, leaders, NGOs, celebrities and big businesses believe that speaking to audiences like those at Davos mattered and made a difference.
The 2008-2009 financial crisis; BREXIT, the SARS-CoV2 pandemic, the war in Ukraine, and the “America First” strategy of the US President Donald Trump, have put the world on the defensive and instead of coining strategies to change the status quo -as it was the case in the past- today most countries comply with Trump’s wishes and tend to be more isolationist. The United Nations, facing a worrisome paralysis, is fighting to keep the system as functional as possible amidst the worst financial crisis ever faced plus lacking interest of member countries on its resurgence.
An internal investigation was conducted on WEF management, and the issue was commented by influential media like “The Washington Post.” Accusations included sexual harassment, age discrimination, and a pretended appropriation of “Davos” as an exclusive label by Schwab who even proposed the idea of moving the forum to Dubai just because the major of Davos wanted more credit for the hosting resort. Although the German Engineer was not found guilty of anything serious, the shadow of the doubt proved to be demolishing. Apart from personal trips and other luxuries for Schwab and his wife, the most suspicious news was the meeting between the creator of the WEF and the head of the European Central Bank (ECB), Christine Lagarde, whose term at the institution will come to an end in 2027. Apparently, Schwab intended Lagarde to become the head of the WEF after she finishes her term at the ECB. This led to speculation about Lagarde-Schwab meeting and prompted the German Engineer to resign as chair of the WEF Board of Trustees in 2025. He considers the accusations unfair by arguing he built the WEF with its own money and contacts. But the sponsors of the WEF do not want to be linked to a situation where their image and profile suffer from mistrust or worse, corruption accusations.
It is also true that other fora with more credibility such as the Munich Security Conference and Saudi Arabia’s Future Investment Initiative have emerged as an alternative to the WEF. In fact, the Munich Security Conference was created prior to the WEF, back in 1963, and focused mostly on challenges to international security. It gathers annually, and has gained prominence due to the participation of leaders like Vladimir Putin in 2007; Nicolas Sarkozy, Angela Merkel, Donald Tusk, Hamid Karzai and Joe Biden in 2009; Ban Ki-moon, Hillary Clinton and Sergey Labrov in 2011; Antonio Guterres, Mike Pence and Wang Yi in 2017; Kamala Harris, Anthony Blinken, Emmanuel Macron, Rishi Sunak, Olaf Scholz, Ursula von der Leyen, Jens Stoltenberg and Volodimir Zelensky in 2023, among others. Last year US Vice president JD Vance criticized the absence of representatives from populist parties at the conference, since, according to him, free speech in Europe was experiencing setbacks. Despite that, the Munich Security Conference has attracted a lot of interest and to many is more trustworthy than the WEF. This is because besides the leaders’ gathering, the conference also hosts roundtables dealing with European security, cybersecurity and human security issues. There is also the Security Innovation Board that brings technology and defense sectors to a dialogue on innovation in the security field. Finally, a very attractive Zeitwende tour was established so that citizens could exchange views with political leaders and defense and technology experts on related matters. These events have refreshed and renewed the interest of participants in international security.
The other gathering competing with the WEF is the Future Investment Initiative, born in 2017 under the premises of the Saudi Arabia’s sovereign wealth fund. The forum gathers annually bringing together policymakers, investors, entrepreneurs, and young leaders to discuss international investment and the global economy. Crown Prince Mohammed bin Salman intends to make the Future Investment Initiative part of the Saudi Vision 2030, to boost the country’s profile not only for investment purposes but also to show Ryad is very much involved in Global Governance. This is especially important due to the assassination of Jamal Khashoggi -a Saudi dissident- by Saudi agents in Turkey in October 2018. Prominent leaders canceled their participation at the Future Investment Initiative to protest the assassination. Nevertheless, Saudi Arabia has been able to establish an alternative forum to the European-centered gatherings, and it has used the Future Investment Initiative to announce the way the Public Investment Fund of the country is evolving. The Future Investment Fund is already considered “the Davos of the Desert” even though Schwab and other prominent CEOs of the WEF dislike the term since they claim Davos is a Swiss location.
The thing is that these fora, the WEF, the Munich Security Conference and the Future Investment Initiative seem to concentrate the debates over world’s priorities but there is the feeling that developing countries are left behind, not to mention Asia, the region apparently destined to lead the world economy. But due to the crisis of multilateral institutions and the rise of nationalist and protectionist policies all over the world, these three gatherings still offer some options for dialogue, although as seen in the case of WEF and the Future Investment Fund it is very easy to damage their reputation due to mismanagement or political scandals as the Khashoggi case has shown.
Editor’s Note: The above guest column was penned by María Cristina Rosas, a professor and researcher in the faculty of political and social sciences at the National Autonomous University of Mexico in Mexico City. The column appears in The Rio Grande Guardian International News Service with the permission of the author. Rosas can be reached via email at: mcrosas@prodigy.net.mx
