WEF meet ends; leaders exude cautious optimism over global economy

Written by PTI | Davos | Updated: Jan 26 2014, 05:11am hrs
WEFWEF debated on issues such as climate change, unemployment, sustainability, innovative disruptions. AP
With a sense of cautious optimism over the world economy, the five-day World Economic Forum annual meet of influential leaders that saw extensive deliberations over responsible capitalism, gender inequality and Middle East turmoil, came to an end today. With a strong presence of close to 130 participants, Indian leaders exuded confidence in India's growth story and pitched for sustained structural reforms even as investors were curious about general elections and advent of a new political force in the form of the Aam Aadmi Party (AAP).

Capping the WEF Annual Meeting 2014, its seven Co-Chairs, including India's Kris Gopalakrishnan (Infosys Vice Chairman and CII President) and Yahoo chief Marissa Mayer, debated the emerging issues of 2014 and their implications for the global

economy and their industries at the final session.

Earlier, talking about the risks and challenges before the global economy, IMF Chief Christine Lagarde said countries, including emerging markets, should carry out structural reforms to unleash their growth potential.

India's Planning Commission Deputy Chairman Montek Singh Ahluwalia said the country is pursuing broader economic reforms agenda, which is unlikely to see a change irrespective of the election outcome.

Gopalakrishnan is optimistic about 2014 and beyond.

According to him, the WEF debated on various issues such as climate change, technology, unemployment, sustainability and innovative disruptions. It is a connected world and we need to adapt to the changes and prepare for the transition,

he said, while giving example of how recent currency market fluctuations have had impact in different parts of the world. Christophe de Margerie, Chairman and Chief Executive Officer, Total, France, also a WEF Co-Chair, said 2014 would be an important year for energy sector, as regulations would need to be put in place before the climate summit in 2015. Another co-chair, Novartis chief Joseph Jimenez said 2014 was going to be a year of technology for various sectors, including healthcare.

Among 2,500 WEF participants, a third were first timers. Over 30 heads of states attended Davos 2014. The participants discussed diverse topics in the final WEF session titled 'The Global Agenda'.

Chinese bank ICBC chief Jiang Jianqing said emerging markets were likely to witness uncertainty because of tapering. He listed out financial sector regulations, and challenges related to technology including the challenges posed by Internet to the banking sector,as major areas toward out for in 2014.

On Iran making efforts to engage with global community and whether Total would seek to re-enter Iran, its CEO Christophe Margerie said country has plenty of oil and gas. If Iran is able to find an agreement at political levels and the embargoes are lifted and if terms are acceptable, they are ready to sign contracts and do business, but it was not known today where those embargoes would be lifted, he said.

On Israeli Prime Minister Benjamin Netanhayu saying that Iran President Hassan Rouhani cannot be believed and the West should not do business with Iran, Rockefeller Foundation chief Judith Rodin said they were public statements and private diplomacy but it was not clear how this private diplomacy was progressing.

"We are eager to see what are the outcomes and I want to believe there would be outcomes," she said. Regarding China-Japan differences, ICBC's Jianqing said China was a peace loving country and it depends on Japan whether there can be any conflict. He said that many Chinese were killed by Japanese invaders during Second World War. The key is Japan here, he added.

Meanwhile, Gopalakrishnan said India is determined to maintain high growth, but there would be uncertainly till elections in India and elections are always chaotic in India. According to him, a few months back no one knew a new party would form the government in Delhi. After the polls, however, things should stabilise and that would be good for India and the entire world, he added.

On whether inequality in income and other areas could lead to greater unrest this year, leaders said it was indeed a poblem especially in emerging economies.

On technology leading to possible privacy threats, Yahoo!'s Marissa Mayer said the right way to handle the data, whether by her company or others companies or the government, was to bring in greater transparency.

With respect to data, Gopalakrishnan said there should be a balance between needs of the state and the administration. This can be done through a proper framework or may be international agreements that would allow data of citizens from one particular nation to remain in that country, he said.

On governments' accessing data, ICBC chairman said data is like a bank deposit and personal property of an individual. In China, information protection is very good but there are cases of attacks on networks to steal data. Unless there is security, nobody would like to save data on the cloud, Jianqing added.

On whether there would be significant investments in 2014 or they would save cash, ICBC said it would depend on opportunities.

Meanwhile, Novartis' Joseph Jimenez said he was investing in business, while Total chief Margerie said his company actually invests on a 20-year basis. Total would be investing less in 2014, not because of any short term views but as part of its long term strategy.

Striking a bullish note, Gopalakrishnan said 2014 was expected to be better than 2013 and mentioned that he was getting such a feeling from Infosys clients. On the other hand, opalakrishnan said he wished do something at a personal level this year related to issues outside his professional work. Yahoo!'s Mayer said she expects new ideas to emerge and new technologies to come up this year.

Reflecting the overall positive sense, the WEF annual meet closed with a musical performance themed 'leap of faith'.