The irrelevance of the WEF in Davos Djoko Susilo   ;    Indonesian ambassador to Switzerland

JAKARTA POST,  23 Januari 2014

                                                                                                                        

                                                                                         

Every year in the last week of January, the small, Swiss town of Davos is full of very important people from around the world.  Presidents, ministers, politicians, businessmen and top journalists are present in Kongress Zentrum for a three-day event called the World Economic Forum (WEF). This year’s meeting carries the major theme of “The reshaping of the world: Consequences for society, politics and business”. I lived in Switzerland for almost four years, and because of my job as an ambassador, every year I had to go up to the mountainous city of Davos, driving almost six hours from Bern, braving the snow covering the road. Every time I arrived in Davos I asked myself, why did these important people need to go to Davos?  It is no secret that participating in Davos costs a lot, so only the rich or companies with big budgets can afford to take part. Take the cost of an executive arriving from Jakarta. To fly first class to Zurich will cost that individual about US$10,000, with a hotel room about $3,000 per night, the WEF annual membership fee $50,000 and other expenses that reach no less than $10,000. A WEF participant will spend a total of $100,000.  So what are the benefits of the Davos meeting for Indonesian companies? First, they feel they are part of an important group of people in the world. Only a few select people able to afford such expenses are given access to the WEF club.  While in Davos, there is also the chance to meet important people from around the world. Previous attendees include Microsoft boss Bill Gates, Russian President Vladimir Putin, British Prime Minister David Cameron, German Chancellor Angela Merkel and many others.  They were invited by the WEF and were given a forum to discuss many issues deemed important by the WEF committee. But is the WEF so important that it merits having such large amounts of money spent on it? If the purpose of going to Davos is to participate in debates that will influence the world economy, it is the wrong place.  In my opinion, the World Trade Organization (WTO) forum in Geneva is more important. WTO debates and decisions have never referred to any decision taken in the WEF in Davos. So, for government officials, the advantage of being present in Davos is for networking purposes only. It is good only if one is a foreign minister or a minister of trade, or perhaps if one represents a national investment board.   For me it was a waste of time and money, with the discussions at the WEF just nonsense. The WEF is the brainchild of Klaus Schwab, a professor of business policy at the University of Geneva who chaired the European businessmen meeting in Davos in 1971. The meeting was organized as an informal discussion.  The forum was later incorporated into a non-profit foundation. Until 1987, the forum was called the European Management Forum, but was later renamed to reflect the changing international situation and nature of the discussions, which expanded beyond Europe. The WEF is a private organization and according to the Swiss system of regulation, is considered an NGO.  Therefore, although many heads of states and government, ministers and other high-ranking officials from many countries come to Davos, they are not given VIP protocol services by the Swiss government. Technically, they are the guests of the WEF in Davos. The WEF, though officially a non-profit group, unofficially makes a lot of money by providing accommodation, lodgings, car rentals and other necessities for participants. Although every year participants find difficulties in booking rooms and renting transportation in Davos, the WEF has never considered moving the venue to a bigger city, such as Zurich, where hotels are easy to find and public transport is excellent.  The WEF helps book hotel rooms and provide transportation, but only for presidents, prime ministers and ministers. The majority of visitors fall into the hands of “shark” landlords who rent their apartments at rates 10 times the normal cost. Some Swiss people, especially on the left, are angry with the WEF. Every year they organize rallies against the “neo-liberal and capitalist forum”. A few years ago they attacked and destroyed a McDonald’s fast food outlet. That’s why, perhaps, since then there has been no fast food restaurants or other symbols of capitalism in Davos. Considering the expensive budget, many of my colleagues were reluctant to go to Davos. Representatives of some cost-sensitive governments refused to stay in Davos, but preferred Zurich, which is much cheaper. They would go to Davos only for discussions, speeches or to participate in debates, but nothing more.  Davos is important for exchanging ideas and networking, but will not directly affect global policies on trade or financial matters.  My friend, an ambassador to the WTO, confirmed that no WTO decision took into account WEF recommendations. The “Bali Package” generated at the WTO conference in Bali last November made no mention of the WEF.  Indeed, the WEF has already lost its relevance. Many discussion topics move beyond the reality. This year’s theme is too far from the reality, where global poverty and malnutrition remain unaddressed.  The WEF will remain relevant if it is held to help poor countries, rather than held for the purposes of a few mega rich people who control the world economy.  Schwab and his team must rethink the purpose of the WEF to create a better world for everybody. ●