Leaderless in an Age of Anxiety

The annual summit convened in Abu Dhabi by the World Economic Forum turned out to be an intellectual fest at a time when growing global challenges are calling out for new and innovative solutions. Delegates from over ninety countries brainstormed these issues at the two-day event hosted by the UAE government.

‘Thought leaders’ from academia, government, business and civil society, were organised in 79 councils to consider a wide range of issues on the global agenda. Their findings will help fashion recommendations to key decision makers at the annual meeting at Davos in January 2012, where the theme will be ‘The Great Transformation: Shaping new models’.

The focus at the summit was on discussing and developing new models for global decision-making. Existing models are seen to be lagging behind changes that are being fuelled by globalisation and marked by rising resource needs across the world. WEF meetings take a ‘multistakeholder’ approach based on the premise that unless interconnected global issues are addressed in an integrated way, responses will be woefully inadequate.

This year’s conference took place in an international environment of increasing uncertainty and complexity, heightened by the risks posed by the ongoing economic crisis in the west. Not surprisingly it was a Chinese delegate who issued the clarion call for a new type of global partnership to match the spirit and challenges of the present era. He spoke with the confidence and self-assurance that comes from his country’s growing economic and diplomatic clout on the world stage.

He Yafei, China’s ambassador in Geneva, told the audience that the response to current problems needed to start with ‘ABC’ – A for action, not hesitation on the part of governments to take responsible and immediate action on economic, financial and social policies. B was for boldness, not cowardice in exercising leadership. And C stood for cooperation and a greater sense of togetherness among nations, as well as an approach that eschewed the tendency to blame others for their own mistakes.

A collaborative approach was needed to address the three risks he identified as having the potential to prolong the global economic crisis. One, unresolved structural problems in the advanced economies and slowdown in emerging markets, which raised real fears that the west’s troubles could infect the rest of the world’s economy. The second risk was the social unrest and turmoil the economic crisis was generating, and that was now spilling over into the streets. This is exemplified by the anti-Wall Street protests and similar unrest spreading elsewhere. And three, the loss of confidence among people and the market in the ability of governments to expeditiously overcome this crisis. All this urged the need for reform of global governance based on new cooperative models.

European speakers reflected the nervousness and anxiety of the eurozone sovereign debt crisis that has engulfed the continent and emphasised the breakdown of trust, this has triggered within and between countries. This slow fuse crisis could see protectionist responses and lead to a cascade of global protectionism. This would threaten the world’s trading system.

Bill Richardson, a former US envoy to the UN, described his country’s economy to be in a state of gridlock and he pointed to the pessimism this had engendered about the future. While the US needed to put its own house in order, he maintained that the single greatest risk to global stability was the lack of US leadership – consumed as America was with domestic troubles as presidential elections approached.

The absence of leadership at the global, regional and national levels was a theme that echoed throughout the proceedings. Its impact was magnified at a time of structural change in the global distribution of power and rising multiplicity of actors. Some saw ‘coalitions of the willing’ as a temporary ‘solution’: quick, adaptive and bringing different resources to the table. Others viewed this as a dangerous trend that would undermine multilateral institutions including the UN and WTO and undercut the principle of sovereign equality.

A number of speakers cast the Group of 20 industrialised nations as a ‘coalition of collusion’, questioning its legitimacy and representativeness. “How”, asked a participant, “do you expect countries to abide by G 20 decisions if they are not part of those decisions and are not even informed about them”? An Arab delegate pointed to the Muslim world’s absence in the G 20.

This reinforced the argument that wider representation and closer cooperation should be the “new norm” in a globalised world of global citizens. Mindsets had to adjust to this reality. Sustainability needed priority. For too long the crisis management model had prevailed rather than longer term strategic planning. But even while acknowledging the flux and upheaval of the present era, optimism was expressed by many speakers who underlined the power of human creativity to solve problems. This created the most compelling rationale to invest in human capital.

The sessions on governance in the digital era offered interesting insights. There was a lively debate on how network technologies – enabling unprecedented flows of information – are making states vulnerable, challenging their legitimacy and breaking down boundaries. They are also opening up new ways of global problem solving. States are seen to be delivering too slowly in a world that is moving very fast.

Like every threat this too offers an opportunity. Adapting to a digital world and resolving the present tension between trust and control can help unleash new ways to meet social and economic needs. For now however the world has to consider how best to frame rules to promote digital responsibility, balancing among other things, freedom and protecting privacy.

Understandably, the issue that captured people’s attention and was vigorously debated, though more on the summit sidelines, was the Arab spring and what it meant for the future. A number of ‘what ifs’ were posed. What if the Arab spring – that is still unfolding – is unable to meet the expectations it has raised? Will it be transformed and hijacked by other forces? Was there a danger of radicalisation if the forces driving the ‘Arab spring’ do not stay unified, throw up a cohesive leadership and start to deliver?

What is clear is that the prolonged political transition in these Arab nations is unleashing uncertain dynamics and tensions. It has also exposed the lack of a model for transition, which is heightening chances of unpredictable and unstable outcomes across the region. Dangers include the eruption of civil wars, sectarian strife and erosion of social cohesion in an environment of political disruption and economic stress. While the status quo is untenable and the old order is crumbling, there is as yet no road map or coherent vision of the future emerging from the leaderless movements driving the Arab spring.

This may be inherent in any transformation of authoritarian states. But the lack of leadership in the region – evidenced by the absence of any central institution in the Arab world and the ineffectiveness of the Arab League – is complicating and prolonging wrenching transitions.

Among other trends these momentous developments signal the diminution of America’s clout in the Middle East, much like the 1950s marked the dwindling of British influence in that region. The task of managing the transition falls to the region itself, as it should, even if this is clouded by the present lack of direction.

The concluding plenary brought together a number of different, linked themes with speakers stressing that the energy and quality of the exchange of ideas at the conference was itself a reason for optimism. There was consensus that without institutions nothing is durable, and without leadership nothing is really doable. The most inspirational line or message that resounded at the conference came from the late Steve Jobs: “If you want to predict the future, go invent it”.