World Economic Forum Annual Meeting 2019 | 29 Jan 2019

Recently, the five-day World Economic Forum Annual Meeting 2019 ended with discussions on imminent challenges faced by the global economy, including climate change, growing inequality, and US-China trade tensions.

  • This year’s theme was Globalization 4.0, which includes a strong cultural dimension.
    • Globalization is a phenomenon driven by technology and the movement of ideas, people, and goods. While Globalism is an ideology that prioritizes the neoliberal global order over national interests.
  • A 'Digital Declaration', which calls on businesses to respect the privacy of digital citizens; handle personal data securely and transparently; take meaningful steps to mitigate cyber threats, and ensure everyone can participate in the digital economy as it develops whilst combating online harassment, was also signed.

Waves of Globalisation

  • Globalization 1.0 was pre-World War 1 globalization, which was launched by a historic drop in trade costs when steam and other forms of mechanical power made it economical to consume goods made far away.
    • This globalization came with almost no government support.
    • There was no global governance.
  • Globalization 2.0 is the post-World War II phase where trade in goods was combined with complementary domestic policies.
    • The market was in charge of efficiency while the government was in charge of justice.
    • Internationally, Globalization 2.0 saw the establishment of institute-based, rule-based international governance, specifically the UN, IMF, World Bank, GATT/WTO and many specialized agencies like the Food and Agricultural Organisation and International Labour Organisation.
  • Globalization 3.0 or hyperglobalization, as termed by Arvind Subramanian created a new world of manufacturing in which high-tech was combined with low wages. This meant factories crossing borders.

  • Globalization 4.0 is a new stage of globalization which involves cutting-edge new technologies like artificial intelligence that powers forward with the explosion of information technology.

    • These shrink distances, open up borders and minds and bring people all across the globe closer together.

World Economic Forum (WEF)

  • The World Economic Forum (WEF) is a Swiss nonprofit foundation established in 1971, based in Geneva, Switzerland.
  • Recognized by the Swiss authorities as the international institution for public-private cooperation, its mission is cited as, "committed to improving the state of the world by engaging business, political, academic, and other leaders of society to shape global, regional, and industry agendas".
  • Founder and Executive Chairman- Klaus Schwab.
  • Some major reports published by WEF are:
    • Global Competitiveness Report
      • This monitors the performance of countries based on a set of 12 categories called ‘pillars of competitiveness’, namely institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labour market efficiency, financial market development, technological readiness, market size, business application and innovation.
    • Global IT Report
      • WEF along with INSEAD, and Cornell University publishes this report which examines the increasing proliferation of technology and its effects on advancing global prosperity.
    • Global Gender Gap Report
    • Global Risk Report
      • It enlists the threats which the world will face in future ranging from geopolitical and geo-economic tensions to environmental degradation and disruptions of the Fourth Industrial Revolution.
    • Global Travel and Tourism Report
      • It measures set of factors and policies that enable sustainable development of travel and tourism sector.