World Economic Forum

• 18 Jan 2024

Source: IE

Why in News?

The World Economic Forum (WEF) is holding its Annual Meeting from 15^th January to 19^th January, 2024 in Davos, Switzerland.

What are the Major Points Related to the World Economic Forum (WEF)?

• About: WEF is the International Organization for Public-Private Cooperation. The Forum engages the foremost political, business, cultural and other leaders of society to shape global, regional and industry agendas.
  • It is headquartered in Geneva, Switzerland.
• Foundation: Klaus Schwab, a German professor with a background in mechanical engineering and a Master of Public Administration from Harvard, founded WEF in 1971, originally known as the European Management Forum.
  • He introduced the concept of “stakeholder capitalism.”
  • According to Schwab, “It is a form of capitalism in which companies do not only optimize short-term profits for shareholders, but seek long term value creation, by taking into account the needs of all their stakeholders, and society at large.”

Note: The European Management Forum was the first non-governmental institution to initiate a partnership with China’s economic development commissions, spurring economic reform policies in China.

• Evolution: Events in 1973, namely the collapse of the Bretton Woods fixed exchange rate mechanism and the Arab-Israeli War, saw the Annual Meeting expand its focus from management to economic and social issues.
  • Two years later, the organization introduced a system of membership for ‘the 1,000 leading companies of the world.
  • In 1987, the European Management Forum formally became the World Economic Forum and sought to broaden its vision to include providing a platform for dialogue
  • In 2015, the Forum was formally recognised as an international organization.
• Funding: Primarily supported by partnering corporations, typically with annual turnovers exceeding USD 5 billion.
• Annual Meeting in Davos: Davos brings together around 3,000 participants (including paying members and select invitees): investors, business leaders, political leaders, economists, celebrities, and others to discuss global issues across 500 sessions
• Key Diplomatic Moments at WEF:
  • Korean Diplomacy: North and South Korea held first ministerial-level meetings in Davos.
  • German Reunification (1989): East German Prime Minister and German Chancellor met at WEF to discuss reunification.
  • South African Milestone (1992): South African President de Klerk, Nelson Mandela, and Zulu prince Mangosuthu Buthelezi made their inaugural joint appearance outside South Africa, marking a significant milestone in the country's political transition.
  • G20 Genesis(1998): WEF emphasized the need to involve major developing countries. Therefore, the concept of G20 emerged, initially limited to finance ministers.
    • G20, born from WEF discussions, evolved into a summit.
• Major Reports: WEF regularly publishes globally recognized reports, including the Global Competitiveness Report and the Global Gender Gap Report, Energy Transition Index, Global Risk Report, Global Travel and Tourism Report.

UPSC Civil Services Examination, Previous Year Questions (PYQs)

Q1. Which of the following gives ‘Global Gender Gap Index’ ranking to the countries of the world? (2017)

(a) World Economic Forum
(b) UN Human Rights Council
(c) UN Women
(d) World Health Organization

Ans: (a)

Q2. Who among the following is the founder of World Economic Forum? (2009)

(a) Klaus Schwab
(b) John Kenneth Galbraith
(c) Hobert Zoellick
(d) Paul Krugman

Ans (a)

Q3. The Global Competitiveness Report is published by the (2019)

(a) International Monetary Fund
(b) United Nations Conference on Trade and Development
(c) World Economic Forum
(d) World Bank

Ans: (c)