Should one still go to Davos in these times, when war is raging in Europe, climate change is accelerating, and the failure of old elites is becoming evident? I asked that in this newsletter last week. Has this summit format of globalization apologists survived in a time of de-coupling and the “Inflation Reduction Act”?
Now while I’m sitting on the train With the Swiss Alps to the right and left of the railway line, which are only covered with a thin layer of snow, I have to think about the discussions of the past few days.
In the many prominently occupied rounds the big questions of the world were dealt with. The decoupling of the USA from China, the world’s response to the USA’s “Inflation Reduction Act”, the prospects for growth – and the long-running issue of globalization.
However, many discussions failed to provide answers, often it remained with the pure diagnosis. There was a lack of major political impetus, of surprising ideas. And maybe that was also due to the fact that many political heads were missing. Instead, a bit of saving the world, a bit of growth folklore, a bit of tech euphoria – that’s it. The format of many events, the sometimes endlessly stringed discussion panels, reinforced this impression.
Nevertheless, the World Economic Forum came at the right time. Many heads of state of major economies were absent. The most important minds from business were all there. And there are few other places where the CEO of a mining company, female economists, NGO representatives and young female entrepreneurs come together and have time to exchange ideas. This is more important than ever in this increasingly fragmented world.
There are also chance encounters that make up the WEF. For example, last night I spoke to a parliamentarian from Kyiv, a drone developer from Silicon Valley came in, and finally the CEO of Uber.
Things always come up at the WEF for whom there is no other place in a world in which politicians and media people too often only sit across from each other on talk shows and throw pre-formulated thoughts at each other. On Monday, Federal Minister of Economics Robert Habeck aptly said at the Handelsblatt energy summit that Davos is also a place to listen.
By the way, it was also worth to listen to the Minister of Economy. In his appearance, he said, “Europe is paying the price for Germany’s dependence on Russian gas,” which was nothing more than a reckoning with the Merkel era.
Hard billed then also with the appearance of Federal Chancellor Olaf Scholz, who in his pale appearance in Davos raved about a new “Germany speed”. One European banker complained that one could “really only laugh out loud” at this. And Fatih Birol, head of the International Energy Agency (IEA), scoffed when we met him in a hotel lobby for an interview: “It depends on when you start counting. This summer – or 20 years before that.”
Incidentally, one of the surprising findings from Davos is that the economy may not be as bad as many thought a few months ago. Gita Gopinath, Vice President of the International Monetary Fund (IMF), said on the first day of the elite meeting in the mountains that the IMF would revise the gloomy outlook for the global economy published a few months ago: by the end of the year and early 2024 there could be a change brighten the economy significantly. I have summarized the nine most important lessons from Davos for you here.
And my live talk from Davos with SAP CEO Christian Klein can be found here.
What else kept us busy this week:
1. Scholz’s appearance in Davos also disappointed many because he did not move in the tank debate. Meanwhile, the industry is getting ready for deliveries. Manufacturers are going through different ideas of what they can deliver. According to information from the Handelsblatt, the first 20 Leopard 1 could be operational in six to eight months, and another 60 in 20 months at the latest.
2. The new secretary of defense arrives in his new reality within hours. He immediately gave his ministry an order to check how many Leopard 1 and 2 tanks were available from the Bundeswehr and industrial stocks. However, it is absurd that this question was not asked months ago.
3. Europe seeks an answer on US industrial subsidies – but has not yet been able to agree on a common direction. Now France is advancing, as reported by Handelsblatt reporters from Berlin and Paris: They quote from a previously unpublished strategy paper by the French government. And the details are tough: Paris is in favor of a new EU fund and a “Made in Europe strategy” with more state aid. The plan harbors enormous potential for conflict. Critics consider this to be a planned economy. They’re not entirely wrong about that.
4. He hasn’t been in office for a year – and yet it is becoming increasingly clear how the group will change under him. In the Handelsblatt interview, VW boss Oliver Blume explains how he wants to restructure the company. The brands should take on significantly more responsibility.
5. This week also found one of the most important conferences of the Handelsblatt took place: the energy summit. Over 800 decision-makers from the industry came together in Berlin to talk about their own future. Economics Minister Robert Habeck got the ball rolling. In our interview, he warned of further possible energy bottlenecks in Germany, was open to the separation of CO2 in industrial plants and made a proposal for falling industrial electricity prices.
6. The economic mood is brightening across Europe. However, one does not want to join the cautious optimism: Harvard economist Kenneth Rogoff. “I’m more pessimistic than average,” he said on the fringes of the World Economic Summit in Davos in conversation with my colleague Astrid Dörner. And for Europe he made a grim prediction.
7. Anyone who has ever visited an emergency room talks to doctors or follows the news, who knows: Germany’s clinics are on the verge of collapse. 66 percent of hospitals consider the medical staff situation in their emergency room to be tense. Germany actually has too many clinics. There are 1900 hospitals in Germany, 1071 would be sufficient for optimal care. In the big weekend report, my colleagues Jürgen Klöckner and Maike Telgheder describe what causes the clinics to be overwhelmed and what solutions look like.
8th. Many readers were interested in research by my colleague Mathias Brüggmann this week: He describes the luxury life of the Russian elite, and the hatred of a growing section of Russian society. “A report about killed soldiers, opposite the picture of the wife of a high-ranking official on the beach in Bali – that’s all it takes to trigger a shitstorm in Russian networks,” writes Brüggmann.
9. If you have already worked through your stack of books from Christmas, then I have something for you. The Handelsblatt has compiled the book highlights for the coming months. The topics range from climate, career to the new world order.
I wish you a nice weekend.
Editor-in-Chief of the Handelsblatt
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