THE BLOG

Davos Prides Itself on Looking Forward

24/01/2013 15:01 GMT | Updated 25/03/2013 09:12 GMT

Davos prides itself on looking forward. This year bad luck in the political calendar has left it looking back. A leadership transition in China, recent elections in South Korea and Japan and the early stages of campaigning in India have left Asia with a muted political voice at this Davos. Similarly while US businessman are well represented, few senior politicians are here. So by default the political leaders here are disproportionately European. And so Europe's troubles are being revisited despite the fact that it's hard to find anybody who thinks Europe is going to do much for global growth.

A poll from FTI Consulting shows global business leaders anticipate an extended period of low growth but that by now that is largely discounted in their judgments about the world. It is just an uncomfortable fact that Europe and the rest of the world have to live with. Indeed the most talked about speech at Davos this year was not even given at Davos. David Cameron gave his long delayed, much trailed, speech about Britain in Europe in London before heading up to Davos. Much muttering in the corridors and some indignant explosions to journalists. But many Europeans with a more courteous political culture than Britain's just bit their tongues in public for fear of making things worse.

If our research is right outrage in political and policy circles may actually not be matched among business participants. And indeed casual exchanges at the FTI Consulting party last night tended to confirm our surprising poll discovery that Europe's reputation has been so shop soiled by the chaotic Euro drama that many businessmen would welcome a Hong Kong type solution for Britain: One Europe, two systems. This would allow them a sane, rule of law more lightly regulated place to continue to do business into Europe from so avoiding the regulatory nightmare and financial turbulence of the continent proper. A pipe dream probably. Less interested in the twist and turns of the politics they are impatient with their Europhile cocktail partners who argue this is not the outcome that Cameron's speech will lead to. That rather it has set up Europe for years of uncertainty followed by a British exit.

At a session on European competitiveness yesterday the starkness of Europe's future was clearly exposed. A chart was shown that showed US per capita income steadily pulling way ahead of Europe's which has now been overtaken by South Korea. While the impressive prime ministers of Sweden and Latvia explained how their countries had restored competitiveness along with Germany nobody could muster up much faith that the same thing was going to happen in Southern Europe. And indeed a thoughtful French journalist observed that France did not have the burning platform to do anything as bold as Latvia. When someone unkindly compared Europe's reform performance to Asia's she tartly responded that France was not Singapore.

As troubling for Europeans was the message that reform needs strong national leadership and will. This is a national not a European level issue. Brussels, to the extent it was mentioned, was more of a drag on competitiveness not a source of reform or leadership. One was left with a glimpse of a very different way the European debate might have been framed: not around a British exit but a coalition of reformers (northern European politicians and business leaders) who share a view that the Brussels machinery is anti-growth. But the dye was cast long before Cameron's speech. This would be fought on the old terms: Britain versus the continent.

So Davos this year is treated to a sentimental bit of history: the view of the world from the white cliffs of Dover. A long way from its normal mountain top preoccupations of Asian growth or human inventiveness.