Impressions from Davos
Ian Bremmer, president of the Eurasia Group and a contributing editor to The National Interest, attended the 2008 World Economic Forum in Davos, Switzerland. He shared his impressions of this year's meeting with TNI editor Nikolas Gvosdev.
TNI: How would you characterize the atmosphere at this year's meeting, especially given what was happening in global financial markets?
IB: One of the most striking developments was the mood swing at Davos. When I first arrived, global markets were in freefall and no one was talking about "decoupling" (of the troubles of the American market from the economic health of the rest of the world). By the end, after the BBC-sponsored debate on Friday afternoon (featuring former Secretary of the Treasury John Snow, the vice chairman of the Chinese National People's Congress Cheng Siwei and Palaniappan Chidambaram, the Finance Minister of India), the message was about a "slowdown" but no recession and-most importantly-the "fundamental stability" of the U.S. economy. This led to a shift in the mood of the gathering-towards optimism on prospects of the global economy.
TNI: What is your sense, then, of whether "decoupling" has or has not occurred?
IB: I think that the new buzzword is not "decoupling" but should be "disaggregation." Vulnerability-say to a slowdown of the American economy-differs a great deal from country to country. Those emerging markets that are closely tied to the U.S. economy-such as Turkey, Mexico and other states of Central America-stand to lose. Some of these economies are going to get seriously hurt if a recession does occur. Others-such as Brazil, India and Russia-are well positioned to weather any downturn in the American economy.
TNI: What were some of your overall impressions of this year's gathering?
IB: I found it interesting that there was, in my view, a particularly strong presence at Davos this year from the Persian Gulf states, and those I met seemed undaunted by the troubles of the U.S. market and bullish on the prospects for investment in their region. It was clear that India wanted to use this year's forum to showcase its senior policymakers and entrepreneurs, to portray itself as a world-class, competitive country. However, the Chinese were fewer and far between. There were very few government leaders in attendance (Cheng Siwei being an exception) and only a scattered number of business executives. Most of the Chinese present were experts and academics already based in the West.