Davos: No clear path to the future emerges

Theme of conflict dominates World Economic Forum.

Davos: No clear path to the future emerges

World Bulletin/News Desk

No clear path for the future has emerged from discussions at the World Economic Forum in Davos, Switzerland, this year, which was overshadowed by the theme of conflict in various panel discussions.

The conference, which ended Saturday evening, brought together 2,500 of the most important businesspeople, government officials and regulators to discuss the broad theme of “The Global Context,” which included the spectrum of changes that are affecting all of us today.

Ukrainian President Petro Poroshenko told the conference that the Russian aggression in his country would be met with equal force.

But Russian First Deputy Prime Minister Igor Shuvalov warned that unless the West treated Russia as an equal, the conflict in Ukraine "would remain a bleeding wound" for many years.

U.S. Secretary of State John Kerry also addressed the theme of conflict as he called for a global partnership to oppose terrorism around the world. "We will not be cowed," he said, and demanded a comprehensive international program to fight terrorism both at the military and at the conceptual level. 

No clear solution to income inequality

Still, economic matters were discussed. One of the key themes at the conference was income inequality. But there was no clear path to a solution emerging from panel talks.

Oxfam head Winnie Byanyima argued that the clearest path to resolving excessive income inequality would be tax reform -- taxing the billions in revenue that escape imposition in fiscal havens or through legislative loopholes.

But Sir Martin Sorrell, head of one of the world’s largest advertising agencies WPP, opposed strong economic actions to reduce inequality, saying that much progress had been made in reducing income inequality, and that the middle class had grown extensively, most recently in emerging markets. 

With another point of view, International Monetary Fund Managing Director Christine Lagarde proposed an end to all energy subsidies. She said that this would free up $2 trillion in funds that could be used to invest in programs, which would reduce income inequality around the world. 

Value of economic stimulus

Most of the participants agreed that the economic stimulus proposed Thursday by the European Central Bank, or ECB, was a welcome measure.

But billionaire investor George Soros warned that the measure could lead to asset bubbles.

British Chancellor of the Exchequer George Osborne insisted, however, that the ECB economic stimulus had to be accompanied by structural reforms. 

He pointed to the high level of growth in the U.K. economy which he said had been achieved by structural reforms pushed through without regard to levels of popular appeal.

German Finance Minister Wolfgang Schaeuble agreed, noting that the German economy had succeeded thanks to structural reforms made against popular sentiment.

Last Mod: 25 Ocak 2015, 15:16
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