A video address by Volodymyr Zelenskyy from Kyiv, denouncing the latest slaughter – 87 dead in the bombing of Desna on May 17 – opened the Davos Word Economic Forum on Monday, the first face-to-face summit after the break due to Covid, moved this year to the spring instead of winter in the town in the Swiss Alps.
Geopolitical upheavals and the consequences for the economy were the focus of the attention of the approximately 2,200 guests, including some 40 heads of state and government alongside world economic leaders (while from the G20 there was only German Chancellor Olaf Scholz): the world is at a “turning point,” and that is “not just a rhetorical figure,” the Ukrainian president stressed.
“This is really the moment when it is decided whether brute force will rule the world,” he said, drawing parallels to Sarajevo, 1914 and Munich, 1938.
A first decision taken at the Forum was to convene a conference on Ukraine’s reconstruction for July in Lugano. Zelensky estimates the cost of reconstruction at no less than $500 billion and supports the EU’s idea of freezing Russian assets to finance part of the needed amount. But before we get to that stage, Zalensky insisted on the need for “maximum” sanctions against Moscow, called for the “complete cessation of trade” with Russia, for the extension of the oil embargo, imposed by the US and UK but not yet by the EU because of heavy dependence on Russian oil and divisions between countries, for measures to be taken against “all [Russian] banks without exception,” and he criticized the delays in the reactions from the EU against aggression: sanctions should be “preventive rather than responsive.”
Zelensky also talked about weapons: “If we had received 100% of our needs in February, the result would be tens of thousands of lives saved. That is why Ukraine needs all the weapons we ask for, not just the ones we are given. That is why Ukraine needs financing,” estimated at “at least $5 billion a month,” in order to support its resistance.
The Ukrainian delegation is very large: the Foreign Minister, Dmytro Kuleba, the Minister of Digital Transformation, the mayors of Kyiv, Bucha and Mariupol and a number of parliamentarians are in Davos. This marks a great change, considering that only a few years ago Russia’s Sberbank was a Davos sponsor and Putin an honored guest courted by everyone, while now Russian caviar has disappeared from the tables and the Russia House, located on the Swiss town’s central street, has become the Russia War Crimes House, with an exhibition on devastation and war crimes.
On Tuesday, EC Chairwoman Ursula von der Leyen was set to speak in response to Zelensky’s requests and criticism.
The theme of the Forum this year is Restoring Trust: the world has entered a post-neoliberal phase, it is less open, more fragmented, a process of de-globalization is underway which is tending towards coalescing into large, potentially rival areas. How to rebuild “trust” with the climate crisis, which is affecting all sectors and would require global collaboration, while protectionism and tensions are growing? War is disrupting production and trade.
At the center of attention is the food crisis, which has multiple causes, climatic and economic, exacerbated by the Russian blockade of Ukrainian grain in the Black Sea, which has already led to a 30 percent increase in prices in recent months (while simultaneously increasing profits in agribusiness by 45 percent). Russia’s aggression against Ukraine is disrupting the exports of two major world producers. But other countries, panicked by the threat of famine, have also halted exports: the latest has been India, which stopped exporting wheat; the first was Indonesia with palm oil; but the list also includes Hungary, Serbia, the Caucasus countries, Argentina with meat, Iran with potatoes, China with fertilizer.
There is a dangerous rush towards protectionism, even if only partial, which, according to the FAO, only exacerbates the threat of a food crisis (shutting down exports does not guarantee steady prices at home and makes a country vulnerable to others’ protectionism, as well as encouraging speculation overall). All the global experts, from the FAO to the World Food Program (WFP), are pointing out that there is no global food shortage yet, but that the threat of famine is coming from distortions in distribution, from protectionist drives, global inequalities and an over-concentration in production and trade control.
On Tuesday, Oxfam recalled in its Profiting from Pain report that in the period of the Covid pandemic, across the whole world, a new billionaire was minted every 30 hours and a million more people entered poverty every 33 hours. The way to avoid a major food crisis is through more local production, more diversification and less concentration of international trade: the world market is dominated by four staples (sugar, flour, corn, rice), with only a few exporting countries (24 countries in the world are massively dependent on Russia and Ukraine: Lebanon and Egypt are 80% dependent, Eritrea is 100% dependent), and there are just four dominant multinationals (ABCD: Archer Daniels Midland, Bunge, Cargill, Louis Dreyfus).
