I had the honor of attending the 54th Annual World Economic Forum in Davos, Switzerland on behalf of Nasdaq. Along with 2,500 other leaders, ranging from business executives to government officials to civil society representatives, I participated and listened to conversations about how we can come together to address the most pressing topics of our time. The theme for this year’s event, “Rebuilding Trust,” guided our conversations, prompting us to explore how to drive trust, transparency, consistency and accountability within business, government and society as a whole.
In speaking with clients, partners and government officials over the course of the week, several key themes began to emerge. As we progress through the year, these issues will be top of mind for leaders across the world:
Artificial Intelligence (AI)
As expected, there was an immense amount of discussion about AI, which permeated through almost every conversation. It’s becoming clear that, regarding AI, 2023 was a year for discovering the technology’s potential. This year will now be a year of execution, and we’ll begin to see some of the leaders of the AI race begin to emerge. While there are many factors at play that will determine the winners and losers of the AI race, it will likely come down to the companies that are able to harness the massive amounts of data and computing power necessary to run AI models effectively.
When discussing AI, the topic frequently turns to regulation. In some jurisdictions, there is a rush to regulate the technology. However, when technology like AI comes around that has the power to transform the way we live and work, it’s important to understand the potential of AI to change the world for the better before we begin imposing harsh regulations. At the same time, ensuring regulators are in close discussions with the business community as they develop regulations will ensure that AI policies are able to keep up with the pace of technological advancements.
India’s Emergence on the Global Stage
Several states from India occupied the main promenade as a place for national and state officials to educate attendees on the country’s plans for the economy, green energy, AI and beyond — a direct reflection of India’s rising presence on the global stage. India is well-positioned to capture foreign direct investment from the world’s largest companies, especially Nasdaq-listed companies, with Amazon, Alphabet, Meta and Micron recently expanding their footprint in the country. India has made great strides in opening the country up to foreign investment in recent years, but a major factor in India’s success as an investment destination will be connected to whether the country can streamline regulation, improve infrastructure and continue to reform tax policies to make India attractive to investment from around the world.
Ukraine’s Recovery and the Rebuilding of its Economy
A group of national security officials from over 80 countries, including Ukrainian President Zelenskyy and U.S. Secretary of State Blinken, met to explore solutions to the ongoing war in Ukraine. As discussions around Zelenskyy’s proposed plan to end the war progress, a shift in focus has occurred at the same time. Business leaders and government officials are beginning to hold discussions around what Ukraine’s recovery will look like and how different countries and organizations will be able to lend support to rebuilding efforts. As the war progresses, the economic impact of the uncertainty will continue to be felt across Europe, with the potential to impact foreign direct investment across the continent.
Climate Continues to be a Pressing Issue
With the annual meeting taking place on the heels of COP28, environmental issues remained on the top of peoples’ minds. Many attendees continued to call for a sense of urgency in regards to the energy transition, and discussions focused on potential hurdles the clean energy movement faces. Across the world, many countries are aligned on the idea that if navigated correctly, the green economy will not only help the environment, but it will also create jobs. Many emerging markets see the green economy as a major opportunity for gross domestic product (GDP) growth, but there’s a need for private sector capital investment to help catalyze these efforts at scale.
The Upcoming U.S. Election
As we approached the Iowa caucus, it became evident that there is a growing curiosity – and in some cases concern – about the upcoming election in this country. Former U.S. President Donald Trump’s performance at the Iowa caucus became a major discussion point in the second half of the week, with many leaders giving early predictions on how the U.S. election may shake out. It’s clear that the world will be watching as the presidential election progresses, with an eye toward how the outcome will impact U.S. economic and foreign policy. Although the election isn’t until November, it can start to impact the markets much earlier. The markets don’t like uncertainty, and with the uncertainty in the months leading up to an election, we typically see volatility increase. Further, average equity returns during election years are about half of what we see in non-election years. So, although this election may appear to only matter to American citizens, countries are watching to see how it impacts the world economy.
The Davos agenda highlighted that while we’re beginning to see some signs of economic stabilization in the U.S., we are still living in a challenging and unpredictable global operating environment. How the remainder of 2024 unfolds will be determined by the way the world approaches these challenges and opportunities.
Image and article originally from www.nasdaq.com. Read the original article here.