Davos' party spirit frozen amid a new age of anxiety
news.ft.com By Guy de Jonquieres and William Hall Published: January 21 2003 4:00 | Last Updated: January 21 2003 4:00
Dancing the night away is no longer part of the programme for the 2,000 business and government leaders gathering in Davos for the annual meeting of the World Economic Forum. The weekend gala soirée, traditionally the social high point of the six-day event that starts on Thursday, has been scrapped.
The reason is concern that conspicuous partying would send the wrong signals to a world preoccupied with the threat of an Iraq war, terrorism, the North Korean crisis, economic fragility and plunging financial markets. Klaus Schwab, the forum's president, said the times called for a more puritan image.
Uncertainty about the international political and economic outlook is set to weigh heavily on the meeting, which is back in the Swiss resort after the September 11 terrorist attacks led it to decamp to New York last year.
Veteran Davos-goers say the agenda has seldom been more loaded with intractable problems. "Global leaders are at the most important crossroads since the end of the cold war," said Jeffrey Garten, dean of the Yale school of management. "They face massive challenges that are hard to come to grips with."
The perception that the world is a more dangerous place will be heightened by reinforced security, at a cost of $10m (£6.2m). Two thousand soldiers and police will patrol Davos, with more deployed in other cities. Air traffic over Davos will be restricted and unauthorised aircraft risk being shot down.
Anti-globalisation demonstrators, a regular feature of the meeting, will be allowed an orderly weekend march. They will be vetted at the insistence of the US, which is sending a high-profile delegation with cabinet members headed by Colin Powell, secretary of state, and including John Ashcroft, the attorney-general.
This year's headline theme is "building trust". Mr Powell's presence may help reassure an audience worried that the sole superpower is bent on flexing its military muscle.
"The US is perhaps getting the message that if things go on this way it will suffer huge unpopularity globally," said the head of one of Europe's largest companies. "But it still has a big public-relations job to do."
For business leaders Iraq is only one of the clouds on the horizon. Many complain of a more pervasive sense of drift. "There is a sombre attitude among chief executives everywhere," said Peter Sutherland, chairman of BP and Goldman Sachs International and a former Davos chairman. "Many of their concerns are about issues beyond their control."
These hesitations are in stark contrast to the mood of top managers at Davos meetings in the late 1990s, when they coasted on a wave of exuberance propelled by the internet, the new economy, the unstoppable forces of globalisation and confidence in their own infallibility.
It seemed then as though "Davos man", effortlessly bestriding the twin peaks of business and high policy, was master of all he surveyed. But now he - and participants are still predominantly men - has come down to earth.
Triumphalism has been replaced by defensive introspection as the cult of the chief executive has been shattered by the bursting of the stock market bubble, collapsing profits and a succession of US corporate scandals.
"Business leaders' reputations have been trashed," said Mr Garten. "Their attention is still on what went wrong in the last two years, not on what needs to be done for the future."
Others will aim to strike a more positive note. Luis Inácio Lula da Silva, president of Brazil, and Recep Tayyip Erdogan, leader of Turkey's ruling Justice and Development party, will be talking up their new governments' policies. Religious leaders, headed by Lord Carey, former archbishop of Canterbury, will be on hand to offer spiritual uplift.
Many say the real value of the event lies not in the presentations but in the opportunity to network and compare notes. Most big names arrive with diaries full of meetings scheduled far in advance.
What all the talking will achieve is another matter. Mr Schwab has long sought to make Davos an agenda-setting event that generates concrete initiatives. Now, he admits, that task is harder. "Seven or eight years ago you could propose solutions. But many fewer are possible today. If we can contribute to better understanding we will already have done a lot," he said.
For many participants that will be enough. "If Davos did not exist, you would want to create it," said Stuart Eizenstat, a former US deputy Treasury secretary and now a Washington lawyer. "It is about the only place where business and government can exchange ideas and get a sense of direction."
Whether they will have a clearer vision of where they are heading after this year's meeting is an open question.
Additional reporting by William Hall in Zurich Lessons from terror, Page 19 www.ft.com/globaleconomy