CEOs cautiously confident on global growth
Davos, Switzerland, January 26, 2011
Organisers and CEOs at the annual Davos meeting projected cautious confidence in the global economy as the event opened on Wednesday, pointing to numerous risks which could yet derail a still-fragile recovery.
World Economic Forum (WEF) chief Klaus Schwab, who hosts the annual meeting of top executives and politicians, highlighted opportunities in emerging markets, while a CEO confidence survey for the event showed optimism almost back at pre-crisis levels.
"Net-net I think corporates are still uncertain," Martin Sorrell, chief executive of advertising group WPP, told the Forum's opening session.
"Our business grew last year interestingly because of that uncertainty: an unwillingness in the West to invest in capacity, in increasing fixed cost. Boards are terrified of making mistakes."
The four-day event in the Swiss Alps brings together at least 35 national leaders, including the presidents of Russia and France, and over 1,400 business chiefs.
Bankers are keen to show their industry emerging successfully from the wreckage of the global financial crisis and politicians want to dispel the gloom hanging over the euro zone. Both will emphasise how important rapid growth in developing countries is to the global recovery.
The WEF's Schwab told Reuters Insider television before the meeting that he hoped the world was now in post-crisis mode.
"Let's face it, there are so many opportunities with the new engines of growth in the world," Schwab said. "We never had so many representatives from the BRICs ... they are all assembled here in full strength."
Despite rosy prospects for emerging markets, participants were set to discuss the complex threats facing the world and the WEF will launch a global risk network to help firms, governments and international organisations be better prepared.
Alexander Izosimov, chief executive of Russian group Vimpelcom bidding for control of Egypt's Orascom Telecom, said he was well aware of the risks in the Middle East after recent turmoil in Tunisia and Egypt.
"As you go into emerging markets, it's not unfortunately only growth and high returns, sometimes you have to deal with the risks," he told Reuters Insider.
"We've seen those situations in our existing territories in the CIS and I hope that it goes in waves and the environment will stabilise."
The meeting's official theme "Shared Norms for the New Reality" reflects a desire to ensure that the new big players on the global stage share the values of the existing major powers. - Reuters