For the first time since the COVID-19 pandemic swept the globe in 2020, the World Economic Forum (WEF) has been held in full “physical” format in the Swiss resort of Davos all through the third week of January (16-20) 2023. With the theme: “Co-operation in a fragmented world”, the WEF meeting tagged ‘Davos 2023’ provided a veritable rendezvous for deliberations on a motley of current critical challenges confronting the world. Truly, the world, since the onset of Covid-19, has become (and remained) more fragmented than ever before — practically broken or separated into distinct parts — and yet, a ‘global village.’ As an integral part of this ‘fragmented world’, Nigeria has not escaped the (un)intended multiplier or ripple effects of the variegated political and socio-economic challenges the world faced all these years.
At this first ‘physical’post-Covid-19 outing, about 50 heads of state and government from a mix of G20 and G7 countries attended the WEF; in addition to 200 cabinet ministers and about 1,500 business leaders. In total, about 130 countries from around the world were represented at the meeting in the Swiss Alps city of Davos. Further details of the meeting show that a total of 2,700 speakers were invited to grapple to find potential solutions to the “most pressing issues facing the world today.” But this assemblage of personages notwithstanding, one indubitable fact is that Covid-19 and its fallouts have in reality ‘torn the world apart’— thus constituting a counterpoise to the progress and rapid pace of globalisation in the first two decades of the twenty-first century.
Today, one unarguable universal problem the world over is the sharp and continuing rise in the cost of living — reflecting in hyper or runaway inflation. In fact, experts at WEF described 2023 as the “year of the polycrisis” — a year in which all the problems humanity is facing have become more interwoven, more reciprocally damaging than ever and ultimately harder to solve. In the short term, these problems boil down to one key challenge: the cost of living crisis. Multilateral institutions like the International Monetary Fund (IMF) and the World Bank have predicted a global recession this year as a result of geopolitical and economic tailwinds from the war in Ukraine coupled with crippling inflationary trends in most countries. “At least 31 of the 72 world economies forming a third of the global community… may hit recession this year due to rising inflation and energy crisis”, warns the International Monetary Fund (IMF) in its latest World Economic Outlook. In the words of Kristalina Georgieva, the managing director of the IMF, “2023 will be a difficult year for the world. The silver lining is we can use it to transform economies and accelerate change that’s good for our climate, good for growth. At the IMF, we recognize our responsibility to be a force for good,” she noted, adding that a strong U.S. labour market might help the world get through a difficult year. Explaining further, the IMF chief said: “For much of the global economy, 2023 is going to be a tough year as the main engines of global growth – the US, Europe and China – all experience weakening activity.
“The new year is going to be tougher than the year we leave behind. Why? Because the three big economies – the US, EU and China – are all slowing down simultaneously. We expect one-third of the world economy to be in recession. Even countries that are not in recession, it would feel like a recession for hundreds of millions of people,” she added, while speaking on the CBS Sunday morning news programme, ‘Face the Nation’, in the United States.
- Meta shares preparation updates for 2023 elections in Nigeria
- HFN to address critical issues facing Nigeria’s healthcare system at…
- Five Global Trends in Business and Society in 2023
- PETAN targets expansion of local content agenda at SAIPEC 2023
- Imo House of Assembly passes bill to supplement 2023 budget with…
In order to avoid the worst possible scenarios, heads of government and central bank governors across the globe have been facing the inevitable dilemma of whether to spend more money on their citizens to shield them from the biting cost of living crisis or hike interest rates to fight inflation which in turn risks unleashing a global recession. Further heightening these risks and ugly scenarios has been the Russia-Ukraine war — which has wreaked unimagined havoc and lingered beyond expectations. Although Russia’s invasion of Ukraine in February 2022 dominated WEF’s exceptional spring meeting last May, the conflict remains one of the most pressing issues discussed this year — not least because of its implications for global security, defence policies, energy, and food production.
Geopolitical alliances and alignments on both sides of the ‘divide’ as well as a variety of socio-economic sanctions stacked against Russia have been straining primordial relations and fanning tensions in not a few countries and regions. Allied to all these is food insecurity — largely interconnected with other global problems, including the climate crisis. The loss of biodiversity, ever-extreme weather, and the increasing number of natural disasters have played their part in the growing food shortages.
In Nigeria, there has been pervasive flooding, desertification and gully erosion; in other climes, there have been cases of snow, earthquakes, typhoons, etc. Last year (2022), the world faced the triple threat of food, energy, and fertiliser shortages. Experts are already warning that more people would face hunger in 2023 than the previous years as food prices continue to spike, shortages bite harder and more livelihoods are decimated.
One of the disruptions caused by Covid-19 — global supply chain or international trade collapse — is yet to fully restore three years down the line. Indeed, more than anything else, it was the collapse of the global supply chain that sent home the pangs of Covid-19 on the shores of most countries of the world. At the peak of the pandemic in 2020, not a few nations practically stopped trading with many other countries. In fact, many producing nations of the Covid-19 vaccines and other ‘essential commodities’ were known to have banned exportation of such items, especially to developing (or third world) countries. This tendency, rather than abate, has come to stay as one of the anti-globalization trade practices of today. At the WEF meeting, U. S. Treasury Secretary Janet Yellen and others reportedly used the term “friend sharing” to encourage countries to diversify supply chains away from China to market-oriented democracies such as India.
On her part at the WEF, however, Ngozi Okonjo-Iweala, the director-general of the World Trade Organisation (WTO), cautioned against ‘friend sharing’, citing the need to explore trade opportunities more widely with those countries and regions that until now have been left on the margins of world trade. She asked: “Who is a friend? You are not too sure they will be a friend tomorrow; we have seen examples of that,” she told the news agency, Reuters. The WTO chief warned that “friends should not just be in Asia; there is Latin America, there is Africa. There are countries that are places you should de-concentrate manufacturing. You bring them into the supply chain and that way you also include them.” Unfortunately, while the WTO D-G is advocating ‘inclusive trading’, every indication is that the industrial nations are hell bent on choosing their ‘friends’ as trading partners. But rather than being a solution, this ‘segregation’ or discriminatory trade practice remains one problem that is blooming from ‘Davos 2023’. And this sends a good signal to Nigeria and other developing countries that the odds are getting stacked against them as far as global free trade is concerned. Alas, the world is already fully fragmented!
business a.m. commits to publishing a diversity of views, opinions and comments. It, therefore, welcomes your reaction to this and any of our articles via email: email@example.com