In my first dispatch from Davos, I observed that the atmosphere was upbeat. The business community is not worrying much about the dark predictions of the past year. There is, after all, still no collapse of the dollar despite the U.S. trade deficit; interest rates and inflation worldwide are low, and oil price increases are being easily absorbed. India and China are emerging as the new engines of growth and symbols of why market economies work.
CGD Policy Blogs
You will recall my earlier posting on the MCC's decision to approve a compact with Armenia despite what looked like a downward trend in "ruling justly" indicators.
Yesterday, the MCC Board of Directors approved a five-year approximately $307 million Compact with Benin, more than half of which goes to revamping the Port of Cotonou. On the heels of the MCC's experience with approving Armenia's compact amid what still look like slippages in "ruly justly" criteria, MCC CEO Danilovich appears to place conditions on the Benin approval:
Davos is still largely a "Western" event, with the large majority of participants coming from the U.S. and Europe. Among CEOs, there are alarmingly few from Africa, the Middle East and China or even Japan. There are more than before from India, and perhaps a few more from Latin America. But Davos does not look or feel like a truly global forum.
The current issue of The Lancet Infectious Diseases (subscription required) contains several articles related to vaccines and development:
Bill Gates says that Pharmaceutical companies are failing poor countries
'The amount of deaths from these diseases in the rich world is small, so there is no market to do it (develop vaccines),' Gates said during a discussion on forgotten illnesses.
'Millions of people die because of pneumonia and diarrhoea, but nothing has happened because they're killing people in poor countries,' he continued.
Pneumonia kills four million annually, more then the HIV/AIDS death rate, while diarrhoea kills around 2 million, mainly children.
The article Speak softly and carry a big wallet (pdf) about the nomination of Randall Tobias as the new USAID administrator in the January 26th issue of The Economist highlights recent plans for restructuring the US foreign aid program and reviews some of the debate on the potential politicization of US development assistance. The article cites the CGD working paper “The Global War on Terror and U.S.
There was a very impressive debate in the British House of Commons (Hansard Debates for 26 Jan 2006) yesterday about Health Services in Developing Countries.
Gareth Thomas, Hilary Benn's deputy minister in the Department for International Development, spoke for the Government. He drew attention to the importance of health; and described the UK's approach. This includes:
Davos 2006 is surprisingly upbeat -- with much talk of the success of China and India. These are seen as classic cases of the benefits of markets, openness, competition and the entrepreneurship and creativity those business-friendly characteristics can generate. Much less present in the corridors and in sessions is the issue of risks at the global level--whether economic risk for some countries if the commodity boom and low interest rate regime ends--or risks to the global economy (and to the fight against poverty) of a backlash from those who feel left out of the process.