The World Economic Forum held in Davos from 28 January-1 February 2009 debated the current economic crisis threadbare. Interestingly, the picturesque settings in snow-clad Switzerland did not cool the acrid tastes of desperation and anxiety among the majority of participants. Rather anxiety took an upper hand in the sessions relating to Africa and other least developed economies.

Klaus Schwab, the founder and leader of the World Economic Forum, gave an appropriate official theme this year, ‘Shaping a Post-crisis World.’ He pronounced five ethical and economic goals for this new world, which, he argued, would make the world a better place when the economic mess was off. The world will get transformed from one dominated by what he called as ‘ego-capitalism,’ to a greener, more equitable planet of ‘eco-capitalism’.

Philanthrocrisis

But that optimism did not deter the crowd from echoing their wildest concerns. The forecast made by the Institute of International Finance that the investment flow to developing and emerging market economies in 2009 will be down by 60 percent came handy to many speakers. Citing the IIF report, South African Finance Minister Mr. Trevor Manuel told the Davos audience that African economies face the “risk of decoupling, derailment, and abandonment.” Manuel advised the Detroit automakers to stop weeping and to look at the economic catastrophe in Durban, Lilongwe, Bangkok, and Bogota. This amply reflected in the pleading of former U.S. President Mr. Bill Clinton that the Davos gathering to “prioritise keeping people alive.”

World Bank Managing Director Dr. Ngozi Okonjo-Iweala was explicit; “The crisis is not about finance, it’s about people—millions who are at the bottom of the one billion hungriest people. Who is going to take care of them?”

This question was partially answered, when World Bank President Mr. Robert Zoellick, who, on the eve of the Davos forum, proposed an ‘Age of Responsibility’ in which the needs of the poorest citizens of the world are to be addressed vigorously by the wealthiest nations. Zoellick suggested, “As a first step, developed countries should agree to devote 0.7 percent of their stimulus packages” to support the most needy.

Mr. Bill Gates, former CEO of Microsoft announced that his foundation would increase its support for health and development by half a billion dollars, despite loss of core equity. Gates predicted that the Obama administration and Congress would follow suit, boldly supporting overseas aid programmes.

The acute vulnerability of African nations was well expressed by Mozambique’s Prime Minister, Luisa Dias Diogo, who said that 52 percent of her country’s budget was derived from Official Development Assistance (ODA). Any decline in ODA will be felt immediately in Maputo as the government as no option but to cut the size of the government and public services. Many African countries receive 70 percent of the financing for health services and 90 percent of HIV/AIDS support from outside the country.

Thailand’s Prime Minister Mr. Abhisit Vejjajiva bemoaned, “The world has never been more advanced in terms of creating wealth, and yet more and more are becoming hungry. The problem we face is a reflection of market and government failures,” hastened by agricultural market distortions. “The root causes are all about distribution and purchasing power. In some countries, despite the food surplus, the very poorest are the farmers.”

Green Lobby

Most speakers in Davos, felt that green technology and climate change mitigation should factor into global recovery plans. United Nations Secretary General Mr. Ban Ki-moon labeled the economic crisis “a gilt-edged opportunity” and called for heavy investments in a green economy to forestall deeper recession and transform every society on Earth. Al Gore wanted to seize this economic moment to target carbon emissions, or the planet would spiral toward the uninhabitable.

Royal Dutch Shell CEO Mr. Jeroen van der Veer strongly argued for a price put on carbon emitters—presumably including his petroleum company. Emitters should pay dearly, Van der Veer said, and, “At the end of the day, I see carbon as an opportunity and don’t see the financial crisis as a reason to slow down efforts at greening the planet.

Mr. Stuart Wallis of the New Economics Foundation in London advocated “Green New Deal” to massively transform the entire economy and result in dramatic reductions in energy use, and fantastic innovation.

Perceptions of the Poor

But at the end of the day, change, innovation, agriculture, energy, science, and health improvements all fall on the issue of trade and protectionism. Pricing carbon and capping emissions consistently get bent in the face of perceptions that the wealthier world uses such measures to stifle development in poorer countries, preventing their products from competing fairly in the global marketplace.

Poor and emerging market nations feel that they are excluded from key global institutions, such as the G8 and leadership of the World Bank and International Monetary Fund. Without market access, poor countries cannot afford to invest in improving their agricultural and transport systems, and therefore cannot guarantee adequate nutritious food for their own people. Resources deplete, and poor farming practices exacerbate damage to the environment, including water systems.

Mr. Angel Gurria, president of the Organization for Economic Cooperation and Development (OECD), made this clear in Davos, “We missed Doha Trade talks! We lost it! How can we coordinate now? It’s much more difficult, and it will require strong leadership from the United States.”

London Meeting

When curtains were coming down on Davos meeting, attention was turning to the burdens of forecasted 2009 where fears of internal instability, rising unemployment and financial pain are reigning. However, the poor and emerging countries have big hopes on 2 April, when the G20—leaders of the top 20 nations plus the European Union—will gather for an economic summit in London.