WEF 2019, Digitalization, Inequality, and Inclusive Growth

The annual meeting of the World Economic Forum (WEF) took place from 22-25 January 2019 in Davos, Switzerland. Here are focuses on papers and articles on issues of inequality and inclusive growth that took the spotlight at Davos.

Delivering a ‘State of the World’ address at Davos, UN
Secretary-General António Guterres lamented that
despite global problems becoming more integrated and complex, responses are
increasingly “fragmented” and “dysfunctional.” However, amidst prospects of a
global economic slowdown and populist sentiments in several countries where
protectionist policies are on the rise and causing trade disputes, Guterres
remained optimistic.

Hikmet Ersek, President and CEO of Western Union, offers a similarly optimistic take in a post on the WEF blog. He describes the one-on-one connectivity and online platforms enabled by digitization. However, Ersek cautions that connectivity needs to be more inclusive, flagging digital financial inclusion and technological gaps and access as issues that must be addressed through collaborative efforts.

Citing the WESP 2019 report, UN Under-Secretary-General for
Economic and Social Affairs Liu Zhenmin emphasizes in an op-ed on IPS
News that ending poverty is indeed possible, but that doing so “means facing up
to inequality, within and between countries.” Within countries, he underscores
that social exclusion, fragmentation and weak institutions are associated with
high levels of inequality, whereas between countries, most laggard economies
are dependent on imported commodities. To reduce these gaps and tap into countries’
development potential, he notes the importance of both economic diversification
and effective management of natural resources.

An Oxfam report on
inequality shows that the world’s 26 richest individuals own as much wealth as
the bottom 50% of the global population. Titled, ‘Public Good or Private
Wealth?’, the report calls for the transformation of economies to deliver
universal health, education and other public services, arguing that such a
transformation could be enabled by the richest people and corporations paying
“their fair share of tax.” Beyond tackling inequality, a post on
Oxfam’s Politics of Poverty blog notes that other business trends to watch in
2019 include elevating the political responsibility of businesses, shifting
attention towards emerging markets and transforming today’s economic models.

Frans van Houten, CEO of Royal Philips, notes in a post on
the WEF blog that social inclusivity is a prerequisite for sustainable and
inclusive growth, highlighting that “economic growth and good health go hand in
hand.” 

Finally, an op-ed on IPS News by Daniel Mittler, Greenpeace International, describes linkages between Davos, inequality and climate change, and an earlier blog post by Homi Kharas, Brookings Institution, also considers recent trends on growth and inequality. The topics covered in Davos and discussed in this brief are all elements of the overarching theme of the 2019 WEF meeting, ‘Globalization 4.0,’ which is rooted in a context of transformation – of values, of technologies, and of how individuals, businesses and governments engage with the physical and digital world as well as each other.

Source: IISD