Question mark on ability to combat future crisis
"Can we safely say that we can prevent further crises from happening? Do we have the necessary mechanisms in place to ensure sustainable growth globally? We have laid down the groundwork, but we are not there yet," these remarks by German Chancellor Angela Merkel reflected the mood at the conference, which was attended by several heads of states and global CEOs.
Not only Merkel, but other leaders also warned against complacency about the risks of a new financial crisis, saying that all the international mechanisms needed to prevent another crash are not yet in place.
About 2,500 global leaders, CEOs and others participants met at a time when the world has not fully recovered from the global financial meltdown of 2008 and sovereign debt crisis is looming large in several European countries, including Greece, Portugal and Spain.
The world`s largest economies, according to US Treasury Secretary Timothy Geithner, need to collaborate in order to face known and unknown challenges.
"They are not fundamentally in conflict, they are largely complementary. And we are confident that we are going to be able to build a system that serves their interest, and not just ours," Geithner had stressed.
According to UK Prime Minister David Cameron, Europe is facing many problems which are needed to be tackled together by the governments.
French President Nicolas Sarkozy had stressed that it was important to talk and listen to each other, to identify the collective common interest, and find new ways of thinking to help us build the future.
The G20, a club of developed and developing nations, he added, must be productive, and its agenda should focus on three major risks: sovereign debt, monetary and financial imbalance, and the impact of inflation on growth and the soaring price of commodities.
Not only from political leadership, the word of caution was also heard from business leadership with PepsiCo Chairman and CEO Indra Nooyi asking businesses to think beyond making short-term profits.
Business people should be sent back to school so that they can be re-educated not to think only short-term about just making profits, she said, regretting that management success is being defined too narrowly to mean maximising profits for shareholders without consideration of long-term goals such as sustainability.
The corporate mindset still regards adopting sustainability as a matter of resolving conflicts or trade-offs, she had said, pointing out, "We believe that short-term profits and long-term sustainability are not mutually exclusive."
Another theme that was repeated that WEF conference was the need to further open markets and expedite reforms.
"Now is the time to go for a genuine Single Market," he said, pointing to commitments from leaders across Europe to open and free market reform.
According to Japanese Prime Minister Naoto Kan it was essential to reconnect and forge new relationships.
Today, the world faces major changes that can be likened to a tectonic shift, both in national security and in economic fields. I think we need to build new bonds suitable to the times and regions we are living in … it`s important for us to open up ourselves to the rest of the world," Kan had said.
Pointing out that Europe is recovering from the financial crisis more slowly than expected, Greek Prime Minister George Papandreou had said that growth for the Eurozone was projected to be 2 per cent below the global average for 2011.
Eurozone needed to strengthen its identity and make structural reforms if it wanted to continue to compete in a world that is rapidly changing, he had emphasised.