The 2022 World Economic Forum (WEF) annual meeting in Davos, Switzerland, concluded without definitive solutions to a series of global problems.
Nearly 2,500 politicians, business leaders and members of the media gathered in the Swiss resort town hoping to address a wide range of concerns, including skyrocketing inflation, climate change and the war in Ukraine.
Vladimir Putin’s aggression and subsequent economic shocks remained the predominant focus during the World Economic Forum, especially in Ukrainian President Volodymyr Zelenskyy’s keynote address. Speaking via video link, he said his country would not give up any of its land to end Russia’s war.
Asked by journalists about the conflict, Zelenskyy said that this war is not against a particular person or entity, but “for our land, for our freedom, for our independence and for our future.”
International Monetary Fund (IMF) Managing Director Kristalina Georgieva warned the elite group that growing food shortages are “serious” and that the world economy faces its greatest threat since World War II. The IMF expects economic growth of 3.6% by 2022, slightly easing fears of a global recession. However, Georgieva stressed that rising food prices will continue to make this a “difficult year” going forward.
Tension in the global energy market was hotly debated among leaders at Davos, with the US national average for a gallon of gasoline hovering around $4.60, according to AAA. S&P Global Vice President Daniel Yergin said the energy market “was tight before the Ukraine crisis” and is now “being disrupted by the direction of flows.”
Yergin warned that gasoline prices could rise further as China reopens after COVID lockdowns. He argued that if China’s economy recovers strongly, it will further increase global demand for oil and add more pressure to the struggling market.
“Tensions over trade, technology standards, and security have been on the rise for many years, undermining growth and confidence in the current global economic system,” says IMF Managing Director.
Linked to energy is the environment, with President Joe Biden’s climate czar John Kerry expressing optimism following a meeting with his Chinese counterpart during the WEF. This first in-person meeting between the two sides in months is part of an ongoing White House push to significantly reduce greenhouse gas emissions.
The semiconductor industry has been hit by shortages stemming from supply chain bottlenecks, and it has been widely felt in car and computer manufacturing. In the US, total car sales fell 21% year-on-year, according to new research from Deutsche Bank.
Speaking at the annual meeting, Intel CEO Patrick Gelsinger said that these shortages will persist until 2024, but that his company has plans to open 10 new factories in the next five years to alleviate demand for equipment.
Attendees left Switzerland feeling a sense of urgency from war, food shortages and economic uncertainty that shows no immediate signs of relief. For the first time in its more than 50-year history, the World Economic Forum has decision-makers reevaluating the idea of globalization.