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Annual Meeting 2005

"Taking Responsibility for Tough Choices"
Davos, Switzerland, 26-30 January


On this page:
 Annual Meeting sets action priorities for 2005
 New foundations for the transatlantic partnership
 Barroso is "realistically optimistic" for Europe
 Huang outlines China's ambitious targets for 2020
 Economy chiefs upbeat about global growth in 2005
 A view from Capitol Hill
 Debt relief for Africa
 Yushchenko argues Ukraine's case for EU entry
 62 companies commit to combat corruption and bribery
 “The magic has returned to the mountains,” says Peres
 Chancellor Schröder outlines Germany’s development vision
 Democratization of media
 Is business prepared for new risks?
 Egypt's Nazif supports modernization without westernization
 Africa is an emergency that business and society must meet together
 Blair outlines G8 vision for poverty and climate change
 Chirac proposes voluntary tax to fight poverty
 Leaders embrace responsibility for tough choices
 Global Town Hall sees leaders rolling up their sleeves
 Deepening corporate involvement in aid efforts

29 January

Annual Meeting sets action priorities for 2005 – Immediate action on the tough issues of poverty, climate change, education, equitable globalization and good global governance is the responsibility of all society.

Business, political and social leaders committed at the close of the Annual Meeting to combat the ignorance, disease and pollution that threaten our stability and survival.

Specifically, participants at the Annual Meeting called for the implementation of a series of concrete measures designed to yield immediate and long-lasting results, including the adoption of technology to reduce the emission of greenhouse gases, the creation of a fund to accelerate financial aid to the poorest nations and the removal of trade barriers that deprive developing countries of the dividends of global economic growth.

Professor Klaus Schwab, Founder and Executive Chairman of the World Economic Forum, concluded the Annual Meeting by urging participants to exercise “self responsibility, global responsibility – and the tsunami aid showed that we are capable of this - and responsibility to the next generation. Then we will improve the state of the world.”

New foundations for the transatlantic partnership – A workshop on the new foundations of the transatlantic partnership showed that good relations will be the anchor of future world stability. The partnership will be instrumental in addressing security challenges and conflicts worldwide, particularly in the Middle East and on the issue of nuclear proliferation.

The transatlantic partners also need to contribute to the development of a global economic partnership that enables for the alleviation of global poverty, experts from both sides agreed at the workshop.

The future basis of the relationship will be constituted by the ever closer interaction and dialogue between European and American societies. There is a great need that they develop an understanding for the value systems of their respective societies, and on this basis, develop a joint framework of action to address global challenges.

Barroso is "realistically optimistic" for Europe – Long-term growth is the top priority for the present European Commission, said its President Jose Manuel Barroso. He promised to reduce the number of goals in the Lisbon Strategy and to increase accountability in an effort to focus on priorities and ownership.

Where is the reason for pessimism in Europe?, he asked. Put into historical perspective, it is "amazing" that "500 million people living in peace and stability, voluntarily sharing their power. There is no reason for pessismism, but the truth is that we can do better in the future." It's time for a European renewal, he said.

Huang outlines China's ambitious targets for 2020 – China's leadership has made economic development its principle task, said Vice-Premier Huang Ju, who made repeated appeals for more international economic and technical cooperation.

Mr Huang outlined a GDP target of US$ 4 trillion by 2020 and a per capita income of US$ 3,000. China's development includes creating environmental sustainability, including smarter use of energy resources by "putting saving before resource exploitation".

"We have every confidence in the future of China," he said, despite concerns elsewhere over social stability, the environment and economic reform. "China cannot develop in seclusion and the world cannot develop without China's development."

China's development can promote stability and economic development in other countries, argued Huang. "Our set policy is that we will not menace others, even when we are developed."

Economy chiefs upbeat about global growth in 2005 – Resolving international trade disputes, keeping inflation under control and risk taking are among the key ingredients to keeping the global economy growing in 2005, according to business, trade and central bank chiefs.

At a session dedicated to the issue of growth, Robert Zoellick, the US Trade Representative, said that progress in the Doha Round of trade negotiations is critical.

A meeting of trade representatives at the Annual Meeting on Saturday provides a “tremendous opportunity,” he said.

So far, financial markets are reflecting confidence in central banks to keep inflation under control and that trend has been one of the important elements in keeping the economy growing, noted Jean-Claude Trichet, President of the European Central Bank.

Carly Fiorina, Chairman and CEO of HP and a Foundation Board member of the Word Economic Forum, said that companies are showing a greater propensity to invest in growth and risk-taking. However, a big risk for the coming year, agreed Walter Kielholz, Chairman of the Board of Credit Suisse Group, is regulation.

There is concern about regulatory over reach which could undermine growth.

A view from Capitol Hill – Division over Iraq and perceived American unilateralism have given rise to rancour among historic allies in the United States and Europe. Politicians and observers from both sides debated at an Annual Meeting session the future of American foreign policy as the Bush administration begins a second term in the White House.

Although James Leach, Congressman from Iowa (Republican), USA, held that the same values characterized both regions, the panellists all agreed that the US and Europe have to repair their relationship to foster security on both continents and throughout the world.

Bush has matured, contended Orrin Hatch, Senator from Utah (Republican); Chairman of the Senate Judiciary Committee, USA. Hatch held that Condoleezza Rice would be an asset to Europe, as well as the US, and said “I believe Western nations better work together” to combat terrorism.

Debt relief for Africa – Debt relief is the only hope for economic development in Africa, said British Chancellor Gordon Brown, who called for the cancellation of multilateral debt to the most impoverished nations in Africa.

Jeffrey Sachs of the Earth Institute, said that there was nothing left to discuss as the commitments to the Millennium Development Goals had already be made. "There is nothing more to say except 'Do words mean something?'," he said.

"If we do not act, we do not have the right to be forgiven by future generations," said Gordon Brown. President Lula of Brazil said that the inequity between rich and poor countries is "something that is fundamental and needs to be taken into account".

President Benjamin Mkapa of Tanzania said that each year he must find several million dollars to service the Tanzania's debt. "I can use this money for bed nets," he said, which would prevent the loss of 1 million lives every year to malaria.

Actress Sharon Stone stood up at the plenary and invited participants to

Yushchenko argues Ukraine's case for EU entry – Ukraine's "sleeping elephant" is awakening to its potential, said Victor Yushchenko, President of Ukraine. It is a nation with an educated population, a market size of 50 million people and is situated at the geographical heart of Europe.

His victory in the 'orange revolution' shows that Ukraine has European values and "belongs to the civilization of European nations", he said.

Ukraine will file an application for EU membership in the near future. Yushchenko said that he wants every government decision to be a step forward on the path to EU membership, saying that this is the "alpha and omega" of his government's activity.

62 companies commit to combat corruption and bribery – Some 62 corporate leaders have signed up at the Annual Meeting to a zero-tolerance policy to stamp out corruption and bribery.
They committed to support the Principles for Countering Bribery of the World Economic Forum's Partnering Against Corruption Initiative.
The companies’ support means they will either implement anti-bribery and anti-corruption practices based on the PACI Principles or use them to benchmark and improve their existing programmes so they achieve the objectives of the PACI Principles. The PACI Principles are derived from Transparency International’s Business Principles for Countering Bribery.

“The magic has returned to the mountains,” says Peres – There is a new era of hope for a breakthrough in the conflict between Israelis and Palestinians, leaders from both sides agreed at a plenary session at the Annual Meeting in Davos. The opportunity must be seized with immediate concrete steps if the chance is not to be missed.

Salam Fayyad, Palestinian Minister of Finance; Maher Al Masri, Palestinian Minister of Economy, Industry and Trade; Yasser Abed Rabbo, a Palestinian Cabinet Minster; Ehud Olmert, Israel’s Vice-Prime Minister and Minister of Industry, Trade, Labour and Communications; Shimon Peres, Vice-Prime Minister of Israel and Chairman of the Labour Party; Silvan Shalom, Israel’s Deputy Prime Minister and Minister of Foreign Affairs of Israel, met to discuss in Davos how the Middle East peace process could be pushed forward.

For the first time since 1967, Israel is prepared to dismantle settlements and withdraw from territories based on the realization that “we have to change the status quo,” Olmert stated.

The Palestinians this month elected a new president, Mahmoud Abbas, who is committed to getting out of a “vicious circle of conditionality,” said Rabbo. “So he started with a process to bring back law and order in Gaza, to put an end to the circle of violence and start implementing the road map that states that there should be a reciprocal commitment to implement an end to violence.”

Shimon Peres told participants: “This is my 11th Davos, and I must say that the magic has returned to the mountain. What surprised me so pleasantly is not that Mr Abbas was elected so convincingly…but what surprised me is his implementation. In a few days he changed the whole atmosphere.”

Professor Klaus Schwab, Executive Chairman of the Forum, handed each panellist with a mountain crystal, saying it was his dream to host a “World Economic Forum in Bethlehem,” in a peaceful Middle East, “date to be announced soon”.

Chancellor Schröder outlines Germany’s development vision – The German Chancellor, Gerhard Schröder told business and political leaders in Davos that greater developing world market access must be the “prime topic on international agenda”. He called for an end to developed world “agriculture and export subsidies, punitive customs and exise duties” that, he said, undermine sustainable development.

And for those who are "against the new trends,” he pointed out, “globalization bears greater opportunities than risks for all…it’s a question of maximising the opportunities and minimising risks.”

This is why Germany should prepare for the future by undertaking reforms to bolster the economy, Schröder argued.

Germany is committed to the Millennium Development Goals set by the United Nations and supports British Prime Minister Tony Blair’s call for an International Finance Facility to reach those targets.

Closer to home, Schröder said labour liberalization and pension and health care system reform would give fresh impetus to the German economy.

Egypt's Nazif supports modernization without westernization – Egypt's Prime Minister Ahmed Mahmoud Nazif called for the Middle East to integrate into the global economy and to create a business environment that encourages trade and investment with a strong regional focus.

Nazif challenged the notion that modernization necessitates westernization saying that countries "don't have to use the brand of development in the west", a sentiment echoed by Shaukat Aziz, Prime Minister of Pakistan and Najib Razak, Deputy Prime Minister of Malaysia.

Nazif and Masoumeh Ebtekar, Vice-President of Iran, spoke of the expectations of the younger generation, echoing French President Jacques Chirac's earlier warning of a revolt by youth. Nazif said that job creation and increased political participation of youth and women were necessary for economic progress.

Africa is an emergency that business and society must meet together – G8 President and British Prime Minister Tony Blair, presidents of South Africa, Thabo Mbeki and of Nigeria, Olusegun Obasanjo, former President Clinton, Microsoft Chairman Bill Gates and U2’s Bono agreed at the Annual Meeting that until Africa’s needs are seen as an emergency, the Continent will not receive the required critical mass of resources and support.

“I don’t think 6,000 people dying every day from aids is a cause; it’s an emergency,” Bono told almost 2,000 business, cultural, religious and political leaders in Davos. “And 3,000 people dying every day from a mosquito bite is not a cause; it’s an emergency.”

Public-private partnerships that tap into popular support witnessed in the aftermath of the tsunami in South-East Asia, noted Clinton, will do much to tackle the “similar tsunamis” taking place in Africa. “It is ironic that at a time when science is advancing, we’ve allowed the AIDS epidemic to get out of control…and malaria to come back,” said Gates.

Presidents Mbeki and Obasanjo prioritized peace and stability as key to development. Good governance would see more “bankable” projects submitted to international businesses, Mbeki stressed.

“We have the ability in Africa, and we are asking for the heart in government, in the private sector and civil society,” concluded Obasanjo.

Blair outlines G8 vision for poverty and climate change – British Prime Minister Tony Blair outlined his commitment to the double challenge of poverty in Africa and climate change as president of the upcoming G8 Summit. While the challenge of Africa is universally acknowledged, he said, there is still some debate on the "evidence of danger" of climate change.

Developed and emerging economies must reach a consensus on how to deal with climate change and the G8 countries must work with the rapidly developing economies of China and India, Blair told participants at the Annual Meeting.

To ease the concerns of developed economies, Blair said that science and technology should be used to ensure the reduction of carbon emissions while avoiding "unacceptable falls in economic growth".

On Africa, he supported a doubling of aid and total debt relief for the most indebted nations, saying that "the blunt reality is that the Millennium Development Goals cannot be met without such help".

He called for an opening of markets by developed countries and stressed the need for greater conflict resolution capacities in Africa.

Chirac proposes voluntary tax to fight poverty – President of France Jacques Chirac said that the participation of the corporate sector was "crucial" in order to battle poverty. He proposed a voluntary tax as part of a call for more financial resources to be allocated to commion challenges and singled out the battle against AIDS.

He said that the advance of democracy, good governance and anti-corruption are priorities for economic development and warned of the risk of revolt by the youth of the developing world if they are not given a future.

The future of globalization rests on the "promising prospects of cooperation between private and public development stakeholders."

Leaders embrace responsibility for tough choices – Peace, poverty, political stability, trade liberalization and climate change are among the biggest challenges leaders must address, according to the Co-Chairs of the Annual Meeting. It is the responsibility of those in leadership positions to make the tough choices needed to tackle them.

“I view the Annual Meeting as a great opportunity for a diverse group of people from all walks of life to talk about the important issues for the world and then move beyond to come up with proposals for how to address these issues,” said John Thain, CEO, New York Stock Exchange and a Co-Chair of the Annual Meeting.

He noted that the interative Town Hall sessions, will see leaders from business, politics and society come up with action plans.

“I hope that by the end of the Meeting we have pragmatic solutions which each one of us in our individual area of responsibility can implement,” stressed Daniel Vasella, Chairman and CEO, Novartis, and a Co-Chair of the Annual Meeting.

Global Town Hall sees leaders rolling up their sleeves – On the opening day of the Annual Meeting, world leaders are focusing on the toughest challenges facing the world. In a major innovation, they are working together around the Annual Meeting’s theme, in an interactive session called the Global Town Hall.

The Town Hall draws on the concept of engagement first launched by the Swiss in the 15th century.

Participants prioritized the six "tough issues" that should be at the top of the global agenda in 2005: poverty, equitable globalization, climate change, education, Middle East and global governance. They will delve deeper and develop action agendas around these issues.

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