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The Opportunities of Davos

ProfGeoffreyAllenPigman

The World Economic Forum’s 2014 Davos Annual Meeting has begun. Over 2500 world leaders from business, government, NGOs, academe, the media and religious communities from close to 100 countries will attend, including more than 30 heads of state and government.

Finance ministers and central bankers of the G20 are expected to attend, bringing together a critical mass of economic decision makers to a venue with the opportunity to reflect and brainstorm in a Swiss mountain location at one remove from the hectic pace of their daily business. The Forum remains the world's premier platform for multi-stakeholder consultation and cooperation on solving the most challenging global issues and problems. Through its councils and research initiatives, the Forum serves as a key catalyst for building public-private partnerships to address difficult problems ranging from disaster relief to education reforms.

The theme of this year's Davos Annual Meeting is 'The Reshaping of the World: The Consequences for Society, Politics and Business'. World Economic Forum Executive Chairman Klaus Schwab observes that this year the world faces a range of crises and challenges that all link back to the failure of global governance to respond adequately to the impact of globalization. Whilst globalization has lifted millions out of poverty, Schwab argues, it has also posed serious challenges that go unmet, including 75 million youth unemployed worldwide, the demands of urbanization on developing country infrastructure, the ongoing rise in greenhouse gas emissions, lack of adequate risk management in the financial services industry, and the impact of technology upon privacy rights. In contrast to recent years, when the Davos meeting agenda has been dominated by responding to particular immediate crises, Schwab sees this year's agenda as an opportunity for participants to engage in more strategic reflection on problems before they become full-blown global crises. The main sub-themes of this year's meeting are promoting inclusive economic growth, making the most of disruptive innovation, aligning business and government to society's heightened expectations, and promoting sustainable development.

The Forum historically has been important to South Africa, initially in promoting political change in the runup to majority rule in 1994. In 2010 the South African government used the Forum's Davos Annual Meeting skilfully to promote the country's image as South Africa prepared to host the FIFA Football World Cup. The Forum, with its Davos Annual Meeting and yearly Africa regional meeting, offers South African business a vehicle for exercising leadership in Africa. More broadly, the Forum presents an ideal venue for South African business and government to attract international firms to invest in South Africa as a platform for operations throughout SADC and the rest of rapidly growing sub-Saharan Africa.

But the Forum's benchmarking of global business and governance conditions also turns the spotlight on South Africa's weaknesses relative to competitor nations in the developing world. Annual research reports by the Forum such as the Global Competitiveness Report and Global Gender Gap Report produce league tables by country across a range of metrics of economic performance. By highlighting best practice, the reports are intended to stimulate policy debate on strategies for improving performance among stakeholders in each country surveyed. In 2013 South Africa performed particularly poorly in education, with maths and science education ranked 138 out of 148 countries surveyed. South Africa scored dead last out of 148 on labour-management relations and only 116th on labour market efficiency.

Particularly in light of this year's Davos focus on reducing income inequality to generate more inclusive economic growth, South African business, government and civil society should work together to take up the Forum's challenge to engage in a more meaningful domestic political conversation about education, wages and labour-management relations. If they are able to do so, government, business and civil society can coordinate their strategy, or in the absence of coordination any one group could take it forward. The Forum has been particularly effective in facilitating the creation of public-private partnerships for improving the use in primary and secondary school education of technology resources and teacher training. Not to work with the Forum more closely to take advantage of this expertise would be a missed opportunity for South Africa.

This year the most high visibility African participant at Davos is not South Africa but Nigeria, with the Nigerian government hosting a buffet luncheon for participants on opening day, and Aliko Dangote, CEO of Lagos-based conglomerate Dangote Group one of the official co-chairs of the Annual Meeting. In 2012 Dangote was the largest firm in Nigeria by market capitalization. This year Nigeria is scheduled to host the Forum's Africa regional meeting in May, which last year took place in Cape Town. Nigeria's opportunity for greater participation in the Forum is positive for Africa and should not be seen as a loss for South Africa. South Africa already has an established leadership role in the Forum amongst emerging economies and especially in Africa. South African stakeholders only need to learn to leverage it more effectively.

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