A Complex Agenda

Klaus Schwab has always been the public face of the high-profile meetings in Davos. The founder and executive chairman of the World Economic Forum, he was the initiator more than 30 years ago of the idea of bringing together Europe's chief executives to discuss global business strategies in the Swiss resort town.

Schwab established the WEF in 1971 as a nonprofit foundation, eventually expanding its annual gatherings into intense events attended by CEOs and political leaders from around the world. The deep-voiced, German-speaking professor sees the gatherings as catalysts for change, an opportunity for corporate leaders to examine ways in which big business can make the world a better place. He spoke to NEWSWEEK's Arlene Getz about his hopes for the 2004 meeting--and what he expects to be his favorite event. Excerpts:

NEWSWEEK: What is the main message you would like participants to take home from this year's meeting?

Klaus Schwab: The main message is firmly incorporated into the theme of the annual meeting: partnering for security and prosperity. What I would like them to take home is the feeling of the importance and the necessity of partnership, in working together to achieve security and prosperity.

The last two annual meetings have been dominated by major political events: In 2002 it was the September 11 attacks, and last year it was the threat of war in Iraq. Do you expect this year to be somewhat calmer?

[This year] we do not have one single, outstanding, overriding issue on the agenda, but we do have many important discussion areas. I would see Davos as a catalyst for advancing a certain number of global issues.

You've just announced that U.S. Vice President Dick Cheney will also be in Davos. Given that there was so much anger among non-American delegates last year meeting over the Bush administration's plans to invade Iraq, what kind of reception do you expect Cheney to get this year?

The atmosphere, which was very emotional last year, has become much more rational. I think everyone's looking forward to the visit of Vice President Cheney to hear about the United States' long-term strategy in the region and its political context. I think there's now a willingness among the rest of the world to work together with the United States to solve the real issues that we have, like terrorism, weapons of mass destruction, removal of poverty and so on. Vice President Cheney's speech will be very important in providing a context for the future partnership that we have to establish around those issues.

Given the recent wave of business scandals like those involving Enron and Parmalat, do you think the public trusts big corporations to help improve the world?

[Those are] very special cases; it's not the whole business community that has been involved in fraudulent action. I'm aware that business is under attack, but it's a wonderful moment for business also to show that they can take on very specific business responsibilities--creating global wealth and social progress, the responsibilities of acting as true global citizens.

You said recently that we cannot have sustained economic growth across the world unless we have security. Yet a recent WEF survey found that half a billion people consider global security poor and believe that the next generation will live in a less-safe world. Did you expect that result?

If you [consider] the trends and realities of the past, the results of the poll are not surprising. What we want to contribute in Davos is that next time such a poll is taken, people have reason to be less pessimistic about their future.

When you began these meetings back in 1971, the world was a very different place. The Soviet Union and the cold war shaped everyone's agenda; there was no AIDS, no Internet. How much has the Davos program changed since then?

There are two changes that are interrelated. The first one is that the global agenda has become very complex. In working out the program for this year, I could define 100 global challenges. In the past it was much simpler, you had only four. You had trade issues, monetary issues, the North-South conflict and the East-West conflict. Today it's much, much more complex than that. New challenges have been added. [Also,] we are living today in a world which is accelerating, where you have time compression, which means such issues have to be solved in a much shorter time. That makes the responsibilities of decision makers with global responsibilities much more difficult.

What do you consider the biggest threat to world peace?

You have to make a distinction between global politics and global economics. In politics, the No. 1 threat is still terrorism, the No. 2 is still the weapons of mass destruction, even if we didn't find such weapons in Iraq. Let's never forget that today such weapons could be terrible weapons against humanity. In the economic field, I would say the eradication of poverty is probably the No. 1 priority, because it's linked to terrorism. No. 2, the imbalances that we still have in the global economic system, despite economic recovery. Here I'm thinking of the tensions that we see in foreign currency, the budget deficits, not only in the United States, but also in Europe--France and Germany.

In the long run, China and India becoming huge competitors--how we absorb those giants into the world economy--is an opportunity and a threat. Another issue is that of [the growing number of] aging: what it means in terms of health costs, social-security networks.

What are you most looking forward to at this year's meeting?

Moderating the session with Vice President Cheney.