The great bonfire of the void that has always been the World Economic Forum in Davos (tomorrow through next Friday) will be largely extinguished this year. In fact, with the exception of Chancellor Olaf Scholz, all G-7 leaders will be absent. The urgencies are different and crucial compared to the temptation to pose on the red carpet of the global financial elite. To name just three: Giorgia Meloni struggles with excise taxes and dissatisfaction with judicial reform; at home, Joe Biden must fend off opposition attacks after secret papers were found in his garage; Among the restless subjects of the crown, British Prime Minister Rishi Sunak has yet to be forgiven for the icy sovereignty of millionaire Isee (worth £730million).
And yet, perhaps never like this year, while a Fantozzi cloud looms over the global economy, containing high inflation and a looming recession, it would have made sense to listen to the point of view of those who govern us. Instead, we’ll likely have to settle for Christine Lagarde, custodian of the eurozone’s currency temple, and her now-blatant words about the need for more rate hikes to bring down the cost of living.
Also expected in Davos are EU Commission President Ursula von der Leyen, Economic Commissioner Paolo Gentiloni and the number one of the IMF, Kristalina Georgieva.
In fact, even the hosts of the symposium in the Swiss mountains have stopped centrifuging the pneumatic vacuum of past editions. Choosing a slogan that is in itself a warning: «Cooperation in a fragmented world». Cicero pro domo sua: Fragmentation is a sand in the works of “business as usual”. The attending top managers from Amazon, Intel, Blackrock, JP Morgan, Eni and Enel know this very well. Everyone benefits from a change in the current score, so full of pitfalls and risks. Even if the dangers to the economy are hidden behind a canvas: “If governments manage the current crisis poorly – Saadia Zahidi, CEO of Wef told Bloomberg – they risk generating social unease at unprecedented levels as investment in health, Education and economic development are disappearing, further eroding social cohesion. At a time when the war in Ukraine has forced an escalation in defense spending, a caveat also comes from the Wef: “Increasing military spending could reduce support for vulnerable families”, leaving some countries in “perpetual sovereign crisis” and containment the urgent need to address climate change and biodiversity loss. The worst-case scenario that could emerge is therefore that of a “geoeconomic war” destined to exacerbate tensions, or the onset of a new shock event that “could become unmanageable” and delay the fight against climate change. The prospects for the coming months are not the best. The WEF’s annual Global Risks Report, based on a survey by the Forum, showed that the looming recession, cost-of-living crisis and rising debt will dominate the outlook over the next two years. Positions that appear to reflect growing concerns of a hard landing in the global economy. A leap into the void, also due to the impetus given by the central banks to a cycle of interest rate hikes that has not yet been completed. There in Davos, everyone hopes that the snowball won’t turn into an avalanche.