'Open for business' the motto as the rich rub shoulders in Davos

There are fewer parties and film stars this year as leading political and business figures from around the world gather in a …

There are fewer parties and film stars this year as leading political and business figures from around the world gather in a tiny Alpine ski village to rub shoulders for their annual think-in

THE TINY Alpine village of Davos, with a population of about 16,000, is hosting its annual one week meeting of leading global political, business and economic figures. This is where powerful politicians rub shoulders with some of the world’s richest men in cosy ski chalets and piste-side hotels.

They are drawn to Switzerland by the Geneva-based think tank, the World Economic Forum (WEF), which claims to be “dedicated to improving the state of the world”.

Stephen Green, the chairman of the world’s largest bank, HSBC, sets the tone at the annual think-in in Davos, on the first of five days of chin-stroking in the Swiss mountain resort.

READ MORE

There are “no magic wands and I would suggest that crystal balls are in short supply”, he says, suggesting that it will be difficult to figure out how to fix the world’s economic crisis. Green is thanked for being one of the few executives from the world of banking to have braved angry delegates hunting for the culprits who caused the economic meltdown.This is a bit of an absurdity given that the investment bankers and hedge fund managers – the so-called masters of the corporate universe – who frequent Davos year after year to party and network are the very people who knocked the financial globe off its axis. These are the people responsible for flooding the world with loans that were never going to be repaid.

Other regular visitors to Davos, central bankers, the policemen of the banking world, were unable to keep these runaway bankers in check.

The theme of this year’s meeting, Shaping the Post-Crisis World, is equally laughable given that many speakers said that the worst of the economic crisis is yet to come. Financier George Soros declines to say how long the crisis will last, as nothing of this scale has ever happened before. Stephen Roach, head of investment bank Morgan Stanley in Asia, says the world is in a recession “the likes of which we have never seen”. He adds there is “no quick fix”. Media boss Rupert Murdoch says taxpayers are “going to have to pay for all the mistakes of the bankers for the last 20 years”.

“I don’t think this is an angrier Davos this year,” says Irish businessman Peter Sutherland, the former attorney general who is chairman of the world’s fourth richest company, oil giant BP. “It is a deeply anxious Davos and deeply uncertain about the world and where it is going.”

There are fewer cocktail parties this year, or at least the parties are not as heavily publicised as in previous years. One Irish participant says there has been less “prairie-dogging”, where networkers would scan their surroundings looking for high-profile contacts to approach. At one party, US publisher Steve Forbes is quietly enjoing a drink and happy to chat.

Celebrities and film stars, frequent visitors to Davos in previous years, are thin on the ground. Bono, who attended the forum last year to campaign against poverty and for Africa, is a no-show. Movie and martial arts star Jet Li is the best known celebrity in attendance, which in part reflects the shift of power and influence to the East.

Corporate bashes hosted by the global business brands such as PricewaterhouseCoopers and McKinsey are low-key and subtly promoted.

One PR man at a big company warns that its party is off limits to the working media because the high-profile party-goers are in “wind down” mode. Certainly, it is a challenge getting into the more lively evening functions, known affectionately in Davos as “nightcaps”.

To reach the parties, you must navigate security cordons, metal detectors, burly bouncers and corporate hoardings adorned with slogans such as “Let’s create a new path” (Swiss Re) and “Values in action – thinking beyond” (KPMG). Mexico’s “It’s all about trust” jingle is another favourite.

Entry into some of the more lavish hotels is hampered by the presence of Russian prime minster Vladimir Putin, travelling with a cavalcade of 20 SUVs and a massive security team, or by Chinese premier Wen Jiabao, who has a team of about 100 aides and security staff (though one senior Irish delegate points out that this is disproportionately small, given the size of China’s population).

Davos is as popular as ever: 40 heads of state, more than 2,500 participants and 5,000 media, corporate types and various hangers-on visit the village, which struggles to cope. Locals, some of whom are angry at the constant stream of helicopters passing overhead, are staging a protest today.

Sceptics see Davos as nothing more than a talking shop and networking opportunity for rich corporate types. Morgan Stanley’s Stephen Roach tells The Irish Times that he has been travelling to the Swiss Alpine resort for many years and has “never seen a fix come out of Davos”.

For others, such as Irish businessman Denis O’Brien, the forum offers a chance to meet contacts you would otherwise have to travel long distances to reach. Taoiseach Brian Cowen meets, at one dinner, representatives from 14 foreign firms who have invested €14 billion in Ireland and employ 15,000 people.

Another 14 companies, which he hopes will invest, also attend. Ireland is open for business, the Taoiseach tells them. In another hotel, the English Duke of York, Prince Andrew, tells big corporations that Britain is also open for business.

“This is also a great place for listening,” says Denis O’Brien.

“There is an element of it being a talking shop but you come to listen to different perspectives. There is an awful lot of navel-gazing and discussion about what we can do to change things, but you are not seeing the end of capitalism either.”