Davos 2017 – WEF Annual Summit

23 January 2017

DAVOS, SWITZERLAND – ‘Responsive and Responsible Leadership’ was the theme for the 47th annual meeting of the World Economic Forum last week. With over 400 sessions over four days however, everything from climate change to the shifting geopolitical landscape, and NATO to Brexit have been up for discussion. From this melee, we’ve pulled out some of the key highlights.


Brexit – The elephant in the room

Theresa May spoke in Davos to outline the government’s plan for Brexit, assuring attendees that Britain remains “open for business”. Nevertheless, HSBC’s Chief Executive, Stuart Gulliver, confirmed that the bank will move some of its London based staff to Paris, following Britain’s departure from the EU. He was shortly followed by UBS Chairman Axel Weber who echoed Gulliver’s comments, estimating that about 1,000 of the Swiss bank’s 5,000 employees in London could be affected by Brexit. Germany’s Handelsblatt newspaper also reported that Goldman Sachs was mulling slashing its London workforce in half to 3,000, with key operations moving to New York and continental Europe, particularly Frankfurt, where up to 1,000 staff could be transferred.
Following this theme, Christine Lagarde, Managing Director of the International Monetary Fund, issued a stark warning that Britain’s separation from the European Union (EU) will not be “without pain”. Lagarde indicated that any Brexit trade deal with Brussels was unlikely to be as good as the current arrangements enjoyed as being part of the single market.

Chinese President, Xi Jinping and Alibaba’s Jack Ma bat for globalisation

Xi Jinping achieved the distinction of becoming the first ever Chinese leader to attend the Davos meet, and he embraced the opportunity to promote inclusive globalisation and warned that populist approaches can lead to war and poverty. This comes at a crucial time for China, a country that is concerned about potential trade barriers in an environment when domestic growth is slowing from its historic levels.

Jack Ma, the founder of Alibaba, was a part of Xi’s 200 strong entourage at the summit. Responding to America’s mounting backlash against globalisation, the powerful businessman added that China and America should think very carefully before starting a trade war as it would turn out to be a disaster for both nations and the world.

Change is Scary

Throughout the summit, there was a pervading sense that the world is experiencing its most significant geopolitical shift since the Cold War. Economist Nouriel Roubini pointed out that the single superpower model we’ve lived with for 30 years is receding; “We are moving into a world in which you have a great many powers” he said, “These great powers can either work together, or there will be increasing frictions and conflicts on trade and currency, on economics and finance”. Many of those in attendance were in agreement with the Chinese delegation that globalisation is worth protecting.

Market opinions

Billionaire investor George Soros was critical of President Donald Trump and cautioned that the euphoria among stock investors would soon ebb away. He expected Trump to fail and warned that any trade war with China would affect economic prosperity. On the Brexit front, Soros predicted a change in UK Prime Minister and forecasted falling living standards. He also sounded pessimistic on Europe, stating that the continent was in the process of disintegration. Meanwhile, Ray Dalio, manager of the world’s largest hedge fund, Bridgewater, commented that populism would overshadow central banks in dictating the future near term course of the market.


It is safe to infer that the main takeaway from the conference was globalisation, and concerns that world trade could take a backseat in the wake of growing populism and nationalism. These issues are not new, but the tempestuous events of 2016 have pushed them to the forefront; perhaps now is the time for change since they can no longer be ignored.