Commentary: WEF's annual Davos meeting is coming to Singapore. That move should be permanent
Anyone who has been to the Davos meetings will be familiar with the inconvenience that the Swiss village represents for participants, says IMD Business School’s Professor Arturo Bris.
LAUSANNE: For the second time in its history, the World Economic Forum (WEF) Annual Meeting will not happen in the small village of Davos in Switzerland.
The first time it uprooted from its traditional host venue was to New York in 2002, to show solidarity with the US after the Sep 11 terrorist attacks and threats from anti-globalisation movements.
This time, forced by the pandemic numbers in the Alpine country, the organisers have decided that if the 2021 meeting is to happen face-to-face, it will have to be in a safer place – Singapore.
The Swiss government has announced nationwide restrictions starting Dec 12 until Jan 20 as infections rose by 4,262 on Tuesday (Dec 8) bringing the country’s total since the beginning of the pandemic to more than 350,000 cases.
ICY DAVOS OR HUMID SINGAPORE?
For participants, the obvious difference to adapt to will be the contrast of temperatures between cold Switzerland and hot and humid Singapore in May.
Despite that, besides the public health safety during the pandemic, Singapore offers a few factors that makes it an attractive location and that could make it a more permanent venue on the WEF circuit.
For one, anyone who has been to the Davos meetings will be familiar with the inconvenience that the Swiss village represents for participants, despite the charm that the ski resort has tucked within the embrace of the Alps.
It is far away from any major airports, which is not a problem if you arrive by helicopter like some of the eminent participants do.
It is also too small to accommodate a large crowd of high-caliber guests and its hotels are far from the best in the world – assuming they are even available. They are also not easy to get to from the conference venue.
Then there’s the inconvenience of walking in fancy Spanish shoes on icy pavements along streets which do little to invite casual conversation because of the freezing air.
Instead, Singapore’s airport is one of the most important hubs in the world, and it is only located half an hour away from Sentosa Island, which would be an outstanding setting for the Annual Meeting if that is the final location decided upon.
It is also the same place where Donald Trump and Kim Jong-un found the security and protection that they needed for their first summit in 2018.
Being a business hub, most of the companies currently participating in Davos have operations or offices in Singapore. The country’s system is also representative of the type of partnership between the public and the private sectors that the WEF champions.
RECOGNISING A RISING ASIA
Second, while it’s true that Davos is conveniently located in the middle of Europe, but as the center of gravity of the world moves east towards Asia, flying to Singapore will probably hold a certain allure for many heads of states and CEOs.
In fact, the WEF would be sending a strong message that it recognises and moves in tandem with the shifts of global economic and political power by permanently switching its flagship event to Asia.
It already organises large summits in China and other countries in the region, so it may make sense to move away from Europe and Switzerland, which are declining as the pillars of the world economy.
In 1974, when the first Annual Meeting took place, the European Union and Switzerland represented 28.3 per cent of the world’s total GDP. In 2019, they together represented 18.5 per cent, which is only slightly above the weight that China has today.
Switzerland remains one of the most competitive economies in the world – extremely resilient and innovative, ranking third this year in IMD Business School’s World Competitiveness Ranking.
The country is among the most digitally advanced in the world and its education system includes two of the top 20 universities worldwide – ETH Zurich and EPFL Lausanne – according to the QS World University Rankings 2020.
It also provides highly qualified personnel to the nation’s industries and services companies.
Its political stability, coupled with an institutional environment where rule of law, security and transparency are paramount, have helped develop an impressive private sector which pushes the economy forward.
SINGAPORE AN IMPORTANT CENTRE
The country is also a potent magnet for capital and talent, as reflected in the 2020 IMD World Talent Ranking, which Switzerland topped. However, the same can be said of Singapore these days, and the two countries are often competing to top various international rankings of competitiveness and innovation.
In 2020, Singapore became for the first time the most competitive economy in the IMD World Competitiveness Rankings. Two of its universities, the National University of Singapore and the Nanyang Technological University, have also risen to be among the top 20 in the world.
While Singapore was once considered the Switzerland of Asia, we could now say that instead Switzerland is becoming the Singapore of Europe.
It is not hard to imagine a scenario in which some of the most important contributions that Switzerland has made to the world, such as the Red Cross, could also move to Asia before long, given the largest part of the world population is there.
The same goes for international organisations that have made their home in the bosom of Europe, the United Nations and FIFA among them.
Dyson moved its headquarters from the UK to Singapore in 2019. Then in autumn this year, it was reported that several among China’s biggest technology firms, such as Alibaba and Bytedance, were expanding operations in Southeast Asia, including Singapore.
It is only a matter of time before other big-name entities, including international organisations, move to Asia, with Singapore well-placed to benefit from any such shift.
PUTTING ON A GOOD SHOW
Third, the 2021 edition will certainly be an important test of the country’s security, road efficiency and hospitality sector. At the same time, traditional security and cybersecurity will be key given that there will be many dignitaries attending – aspects which Singapore should not have any issues with.
However, the island has regularly been a host to important global leaders and events. Besides the annual Shangri-la Dialogue, it has also hosted meetings of the World Trade Organization and the Asia-Pacific Economic Cooperation (APEC), among others.
But that is something that other countries in Asia, let alone the world, can also do. Japan, Hong Kong, South Korea and Dubai, which have all hosted big global events, boast of excellent road infrastructure, air connectivity and world-class hospitality.
In addition to providing an excellent first-time experience to WEF attendees, what can Singapore offer that distinguishes it from other potential host venues?
EAST MEETS WEST
Although the WEF has Swiss roots, which have been established since 1971, it is a globally minded institution. In its own words, the WEF fills the need for “a new kind of institution – one with the adaptability, the entrepreneurialism and the trust of all stakeholders” to enable cross-border and cross-sectoral collaboration and “shape global, regional and industry agendas”.
Earning the trust, support and participation of a wide cross-section of stakeholders may require the WEF to strike a balance between the western and eastern worlds of business and government. Singapore has often been touted as a reflection of both worlds – an English-speaking, Western-culture exposed country on the one hand and a globalised and developed Asian country on the other.
By relocating its annual meeting to Singapore permanently, the WEF would need to better identify with the new rising region of Asia while still maintaining some semblance of Western values, governance and institutions.
That would help it to earn “the trust of all stakeholders” and therefore influence global outcomes.
Despite the humid weather, Singapore will undoubtedly put on a good show, bring in new stakeholders and add fresh perspectives to the table while being a convenient location that is at the heart of a rising Asia.
If things go swimmingly, no one will even want to go back to Davos in January 2022.
Arturo Bris is Professor of Finance at IMD. Since January 2014 he is also leading the world-renowned IMD World Competitiveness Center.