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Today is my final edition of Global Insider — read to the end for a farewell note.
Before that we take you inside how World Economic Forum supremo Klaus Schwab is explaining his obscure succession plan to staff, Barbados Prime Minister Mia Mottley shares what it’s like to be hit with massive interest rate increases from the World Bank and International Monetary Fund, and my colleagues reveal the contents of the European Union’s secret gift vault.
THE WEEK AHEAD
Monday: G-7 foreign ministers are meeting in Japan, with China the main focus of the talks. Meanwhile Sergei Lavrov, Russia’s foreign minister, is in Brasilia, as Brazilian President Luiz Inácio Lula da Silva talks up the idea of a “peace club” designed to end war in Ukraine, which he partly blames on Ukraine and the West.
Tuesday: The Fox News/Dominion Voting Systems defamation trial, set to start today has been unexpectedly pushed to Tuesday, as Fox searches for a settlement alternative.
Thursday: U.S. President Joe Biden hosts Colombian President Gustavo Petro at the White House.
DAVOS DOWNLOAD — WHAT WEF SUPREMO KLAUS SCHWAB TELLS HIS STAFF
Did you know? Schwab runs ChatGPT checks on himself and the World Economic Forum he’s synonymous with. He also wants the forum to be known as the “global platform of platforms.” That’s according to video footage of a recent town hall meeting with WEF staff obtained by POLITICO.
Trust me, Schwab says: Addressing Global Insider’s reporting earlier in 2023 that WEF’s high-paying strategic partners are frustrated at the lack of a transparent plan for replacing 85-year-old Schwab at the head of the organization, Schwab told staff “there is a succession plan. (But) it’s not necessary first to enact it, and second to announce it.”
He insisted “you cannot imagine” a scenario where the forum’s high-powered board of trustees would not have a succession plan in place, and described his working relationship with WEF President Børge Brende as “very complementary.”
REALITY CHECK: WEF’s governance issues aren’t based on rumors, they’re based on the WEF’s own governing statutes, reported by POLITICO, and promulgated by WEF’s obfuscation in refusing to outline its succession plan for external scrutiny.
WEF’s new self-image as a platform: Schwab thinks WEF’s best role is as “an informal but efficient global organization.”
He said the annual meeting of WEF is just stage two of a six-stage process, which includes year-round communities which take action rather than merely gab, and which must use the metaverse to broaden beyond the ultra-elite annual mountain-top gathering the Forum is synonymous with.
Partnership wisdom: “Governments without the innovative power of business will not succeed,” Schwab said, “and business depends more on governments” compared with recent decades.
Schwab’s six-decade history with Harvard Business School: Schwab relayed an anecdote about how his request to skip a year of classes in a HBS masters degree program was rejected in the 1960s. He found a way to sneak into classes while studying at what is now the Kennedy School. After HBS closed that loophole, Schwab went back to the school’s dean to ask his support for a conference he wanted to get going in his native Switzerland, which he gained.
Where did the money come from? Conferences don’t happen for free (as the chief finance officer at any Davos-going company now knows!). WEF started when an upholstery company offered Schwab a $100,000 loan, which he used to hire a conference organizer, Hilde, from the European Farmers Union, who went on to become his wife.
IMF AND WORLD BANK MEETINGS WRAP-UP
As central bankers and finance ministers descended on Washington last week, one of their main jobs was to project unity about their ability to work together to shore up a fragile global economy. In other words, they wanted us to trust them that they have bank defaults and inflation in hand.
While they did enough to prove the IMF is not “paralyzed,” as The Economist has claimed, it wasn’t enough to demonstrate that they’re really able to work in sync to solve the world’s toughest challenges, including climate change.
While officials from leading nations insist they want to World Bank, for example, to do more on climate, they’re not ready to give it the financial arsenal to succeed — and that’s generating plenty of well-evidenced suspicion.
Take for example U.K. minister Andrew Mitchell, who is responsible for Africa and development in the British government, and Barbados Prime Minister Mia Mottley. The pair offered some of the most illuminating data and quotes of the week in a Thursday fireside chat.
“When Covid struck, we found all the money we needed. When a bank went down in California, it was sorted out within three days, when financial crisis struck, we had quantitative easing, and unlimited amounts of money were printed. And yet, when it comes to saving the planet, and honoring our promises, the money isn’t there,” Mitchell said.
Mottley was even more brutal, whipping out her smartphone to quote the interest rate increases the IMF and World Bank have subjected her country to this year, including a World Bank variable rate Covid loan, which jumped from 1.09 percent to 5.48 percent. “Why do my children get mortgages with longer repayment terms than poor countries?” Mottley fumed.
The “Bridgetown Agenda” for financing protection measures for the world’s most climate-vulnerable countries, initiated by Mottley, may be gaining traction, but “I’m actually getting angrier” she said. “While there has been movement, the conversation remains vague.”
Complaining about being given little space on official agendas to advance her cause, she said: “There is something fundamentally wrong with a system that doesn’t give membership countries a voice” and instead treats prime ministers with complaints as “interlopers.”
The possible tipping point: “For the first time in a very long time, the issues confronting the Global South are confronting the Global North” when it comes to extreme weather linked to climate change, Mottley said.
EUROPEAN AND U.S. DEVELOPMENT BANKS SIGN MOU: The U.S. International Development Finance Corporation and the European Investment Bank have signed an agreement to foster investment cooperation in Africa, the Indo-Pacific, Latin America and the Caribbean, the Middle East, and the Western Balkans. The agreement stems from discussions at the new EU-U.S. Trade and Technology Council
European Investment Bank President Werner Hoyer told Global Insider he is an optimist when it comes to Ukraine reconstruction and integration with the European Union.
“They will be successful in Europe. Some people in Europe think it’s going to be very costly [to integrate Ukraine] but if you look at the industrial experience Ukraine had during the time of the Soviet Union, they were very advanced. Ukrainian citizens are much better in the digital world than people in Western Europe. From a strategic point of view: what an opportunity! these people really believe in the link between peace and freedom,” Hoyer said.
Hoyer optimistic about the U.S. Inflation Reduction Act: “The U.S. investing in clean tech, this is beautiful,” he said. While worried about subsidy races “you could argue that pushing down the price of clean tech is beneficial for a broader audience outside the U.S.. That would be the kind way of describing it. Like always, nothing succeeds like success.”
UKRAINE — EAST EUROPEAN GOVERNMENTS IN FIRING LINE OVER GRAIN GLUT: Ukraine is among the world’s top exporters of wheat and other grains, which historically have been shipped to markets as distant as Egypt and Pakistan. With Russia’s invasion last year disrupting Ukraine’s main Black Sea export route, much Ukrainian produce has been diverted to bordering EU countries: Hungary, Poland, Romania and Slovakia, depressing prices in those markets.
Farmers have risen up in protest, and Polish Agriculture Minister Henryk Kowalczyk was forced out last week. Today, Slovakia suspended imports of cereals and other selected products from Ukraine, Prime Minister Eduard Heger said, following similar steps by Hungary over the weekend. Bulgaria is reported to also be considering restrictions on Ukrainian imports. More from POLITICO’s teams in Europe.
G7 — LEADERS RAMP UP RENEWABLE ENERGY: The group of major democratic economies on Sunday signed off on new ambitious targets for renewable energy generation. Meeting in Japan, energy ministers pledged to add the equivalent of 1,000 nuclear reactors of solar power by 2030, and to boost wind power. They did not set a deadline to phase out coal-fired power plants.
ELECTIONS — MASSIVE 2024 TURNOVER EXPECTED IN BRUSSELS: More than half of current members of the European Parliament are set to retire or be dumped in the 2024 election cycle. That means 400 new MEPs could be headed to Brussels.
SCIENCE — “FOREVER CHEMICALS” BREAKTHROUGH: Engineers in Canada developed a new water treatment that removes “forever chemicals” from drinking water safely, efficiently – and for good. “Think Brita filter, but a thousand times better,” per University of British Columbia’s Madjid Mohseni. Several thousand per-and polyfluoroalkyl substances, known as “forever chemicals,” are used to make non-stick or stain-resistant products such as non-stick cookware, but are now commonly found in the water supply.
INSIDE THE EU’S GIFT VAULT: POLITICO’s Eddy Wax takes you on a wild ride to room 55A031 of the European Parliament — aka it’s chamber of gifts, piled high with carefully labeled diplomatic treasures, left to languish after recipients followed official protocols and turned them over (unlike other EU officials were were later turned over to police, or fired, for accepting gifts ranging from suitcases of cash to free first class flights from rival foreign powers). So what’s inside? A Huawei smartphone … from 2013; a Taiwanese wristwatch; a pot of French mustard; a miniature Saudi Arabian door. Check out the pics.
MOVES
Former White House chief of staff Ron Klain is joining O’Melveny, as a partner heading the firm’s strategic counseling and crisis management practice. He will also join the firm’s Executive Committee.
BRAIN FOOD
Why Does the U.S. Care More About Taiwan’s Democracy Than India’s? Howard French argues that the West’s urge to counter China shouldn’t mean ignoring democratic erosion among its own coalition members.
A PERSONAL NOTE FROM RYAN
This is my last edition of Global Insider, which from now on will be in the capable hands of the wonderful POLITICO teams in the U.S. and Europe.
Global Insider was the last of several newsletters and podcasts I helped to create for POLITICO over the past eight years.
It was the honor of a lifetime to co-found POLITICO in Europe in 2015 — and looking back over the nearly 3 million words and 2,000 interviews I’ve since conducted, the gray hairs also make a lot of sense.
What some observers of journalism and politics miss about the beauty of newsletters is the sense of community they foster. Your source is also your reader. Your audience is also your neighbor, even if in the case of Global Insider sometimes we are only neighbors at the occasional globetrotting conference.
In a world of partisan and geopolitical tension, it has been a delight and privilege to have had you as my community.
Thanks to editor Heidi Vogt, producer Sophie Gardner, Matt Kaminski, John Harris, Luiza Savage, Jamil Anderlini, Kate Day, Stephen Brown, Andrew Gray, Stephan Faris, Paul Dallison, Zoya Shetalovich, Emma Anderson, Harry Cooper, Tara Palmeri, Florian Eder, Suzanne Lynch, Jakob Hanke, Jack Blanchard, Alex Wickham, Cristina Gonzalez, Ailbhe Finn, Lina Aburous, Olivia Reingold, Jenny Ament, Annie Rees, Kara Tabor, Brook Hayes, Cornelius Hirsch, Nicole Fallert, Ben Pauker, Emily Cadei, John Yearwood, Paul Volpe, Blake Hounshell, Sue Allan, Nahal Toosi, Phelim Kine, Stuart Lau, Daniel Lippman, Mark Scott, Karl Mathiesen, Tim Ball, Beatrice Jin, Claritza Jimenez, Alisha Powell Gillis and Katherine Warren.
Know that every POLITICO article or newsletter touches several pairs of hands before it makes it to you.
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