World Economic Forum annual meeting begins in Davos

Why in the NEWS?

• "Union Minister Ashwini Vaishnav will lead the Indian delegation to the World Economic Forum Annual Meeting to be held in 2025, where global economic and social issues will be discussed."

Key Points:

• The World Economic Forum (WEF) Annual Meeting 2025 will be held in Davos, Switzerland from January 20 to 24.
• The meeting will be attended by European Commission President Ursula von der Leyen, Chinese Deputy Prime Minister Ding Xuexiang, and other leaders from business and politics.
• Union Minister Ashwini Vaishnav will lead the Indian delegation.
• Maharashtra Chief Minister Devendra Fadnavis, Telangana Chief Minister Revanth Reddy, and Andhra Pradesh Chief Minister Chandrababu Naidu will also attend the meeting.
• Union Minister Ashwini Vaishnav said that the meeting will have detailed discussions on inclusive growth, investment in social, physical and digital infrastructure, and democratization of technology.

What will you read next in this topic?

1. What is World Economic Forum?
2. Who started the World Economic Forum (WEF)?
3. What happens at the WEF (World Economic Forum)?
4. Who funds the WEF?
5. Why is the WEF meeting held in Davos?
6. What else happens at the WEF?

What is World Economic Forum?

• The WEF was founded in 1971. 
• It is a non-governmental organization that brings together leaders from various fields.
• The purpose of the WEF is to discuss global economic, social, and environmental issues and find solutions to them.
• Participants come from the fields of business, politics, academia, and civil society.
• The most famous event of the WEF is the annual meeting held in Davos, Switzerland.
• This meeting is attended by global leaders, policy makers, business executives, economists, and other prominent individuals.

Who started the World Economic Forum (WEF)?

• The World Economic Forum (WEF) was founded by German professor Klaus Schwab. 
• He was a mechanical engineering graduate and founded the WEF in 1971 after receiving a master's degree in public administration from Harvard University's John F. Kennedy School of Government.
• It was previously known as the European Management Forum.
• Schwab introduced the concept of "stakeholder capitalism". 
• According to him, companies should focus not only on the profit of shareholders but also on long-term value creation by taking into account the needs of all stakeholders and society.
• It states that companies should not just serve their shareholders but also take into account the needs of employees, suppliers and the local community.
• The WEF aims to bring together global leaders to discuss current global issues and consider solutions.
• Klaus Schwab was Professor of Business Policy at the University of Geneva, where he worked from 1972 to 2003.

What happens at the WEF (World Economic Forum)?

• Initial Objective: 
  • At the start of the WEF, Professor Klaus Schwab's focus was on bringing European companies closer to US management practices. 
  • However, following events such as the collapse of the Bretton Woods fixed exchange rate mechanism in 1973 and the Arab-Israeli War, the annual meeting shifted its focus from management to economic and social issues.
• Membership System: 
  • In 1975, the WEF introduced a membership system for the '1,000 Leading Companies of the World', allowing leading companies to become members and contribute to global issues.
• Global Partnership: 
  • In 1979, the European Management Forum became the first non-governmental institution to begin a partnership with China's Economic Development Commissions, an important step as China and the US had established diplomatic relations at the time.
• Davos Meeting: 
  • Around 3,000 participants (including paying members and selected invited members) gather in Davos each year. 
  • These include investors, business leaders, political leaders, economists, celebrities, and journalists. 
  • All these people meet for five days to discuss global issues in 500 sessions.
• Main objective: 
  • The main objective of WEF is to bring together various stakeholders on one platform to discuss global and regional socio-economic issues.
• Key themes of last year: 
  • The key themes of WEF last year were artificial intelligence, geopolitical uncertainties, climate change, and slowing economic growth of China.

Who funds the WEF?

• The WEF is funded largely by its partner corporations, which are typically global enterprises with an annual turnover of more than $5 billion.
• These corporations aim to use the WEF's platform to influence the global economy, social issues and other global challenges.

Why is the WEF meeting held in Davos?

• Davos was chosen for a historical reason, as it was the backdrop for Thomas Mann's novel 'The Magic Mountain'.
• The novel tells the story of a young man who comes to stay in a sanatorium in Davos for three weeks and ends up spending seven years there.
• The quiet atmosphere of Davos and the time spent there in this novel were intended to try to create a prosperous and stable global economy, away from the distractions of global politics.
• The quiet and isolated location of Davos, therefore, has become an ideal location for the WEF, where global leaders, business leaders and experts gather to have serious discussions and make decisions.

What else happens at the WEF?

Forum for international diplomacy: 

• The WEF has served as an important venue for decisive international diplomacy in the past. 
• Global leaders have the opportunity to defuse tensions and discuss pressing problems at this forum.

Important diplomatic meetings:

• North and South Korea held their first ministerial meeting in Davos.
• East German Prime Minister Hans Modrow and German Chancellor Helmut Kohl discussed German unification at Davos.
• In 1992, South African President de Klerk met Nelson Mandela and Zulu Prince Mangosuthu Buthelezi, marking an important milestone in South Africa's political transition.

Formation of the G20: 

• In 1998, the WEF's forum was considered to involve important developing countries in the global process. 
• This resulted in the formation of the G20, which comprised finance ministers from developed and developing countries. 
• This meeting later turned into the G20 Summit, and the summit held in Washington DC in 2008 discussed the global economic crisis.

Global Rankings and Indices: 

• WEF regularly publishes global rankings and indices such as the Global Competitiveness Report and the Global Gender Gap Report. 
• These reports provide important statistics related to global growth, competitiveness and gender equality.