ECONOMY | 28.01.2012
In Davos, emerging economies boast of their potential
On the facade of the Hotel Belvedere in central Davos hangs an enormous sign that reads "Brazil." As the fastest-growing economy in Latin America, the country is confidently advertising itself to the other participants of the World Economic Forum, which runs until Sunday.
The Belvedere is the top hotel during the event, hosting both heads of state and government and top business leaders, like energy giant RWE chief Jürgen Grossman and Google's current executive chairman and former CEO, Eric Schmidt.
Mexico is also employing the "think big" principle, and had two large pavilions built nearby to market its economy and host bilateral meetings. Mexican President Felipe Calderon turned up with numerous ministers and one of the largest state delegations.
On Wednesday, Calderon gave a joint press conference with Renault chief Carlos Ghosn, where he announced an investment project of up to $2 billion (1.5 billion euros) in the country. In the coming years, the project is to create some 20,000 new jobs. Mexico currently holds the chairmanship of the Group of 20 leading developed and emerging economies, and plans on organizing several initiatives this year.
Developing economies are strutting their stuff in Davos - and it's no wonder, given their expected average growth of 6 percent in 2012, according to a recent study by the consultancy firm Ernst & Young. In contrast, experts foresee no growth, or perhaps even contraction, in the economy of the eurozone.
Growth engines
Business is shifting to the booming economies in Asia and Latin AmericaIndonesian Trade Minister Gita Wirjawan was at a business forum in Frankfurt shortly before his trip to Davos. He said the response he received from investors interested in the Indonesian market was "far greater" than expected.
"There's a seriousness among many German companies, and a wide range of sectors that they're looking at," he told Deutsche Welle, specifically mentioning the automobile, retail, financial services, agriculture and energy industries.
Wirjawan said Indonesia has "an increasingly conducive business environment," and cited recent upgrades for Indonesia by credit rating agencies Moody's and Fitch to investment-grade status.
"But we're not just thinking of investment-grade status," he said. "We're thinking of hopefully achieving a far better recognition."
Despite Wirjawan's optimism, he said the struggling economies in the developed world were a great worry for everyone.
"We need a strong Europe and a strong US for us to be able to continue developing the way we have been," he said.
Economic ties to Europe
"German companies have long been adjusting themselves to globalization," said Jürgen Kluge, head of the German Haniel Group. "We profit from the growth of emerging economies."
While Kluge praised the export-oriented basis of the German economy, he warned that the world's economic heavyweights would be shifting to the developing world.
"Go some time to the offices of a Chinese company in Shanghai and look at a map that hangs there," he said. "Europe is just on the margins."
Author: Manuela Kasper-Claridge, Davos / acb
Editor: Martin Kuebler dw
Editor: Martin Kuebler dw
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