The FT's chief economics commentator highlights the central issues being discussed at the forum, with world leaders focusing on possible trade action against China, while talking down fears of a global trade war
Filmed by Alpha Grid. Produced by Filip Fortuna. Edited by Paolo Pascual. Footage from Reuters.
The single most striking thing about the mood in Davos this year is optimism from business. Everybody here believes we are in the middle of a really strong recovery. There's nothing to stop it. They're are also buoyed, particularly the Americans, by the tax cuts.
They don't believe we're going to have a real trade war. Generally the feeling is that at last the economy globally is back with these massive synchronised recovery. And particularly, very important in Davos, the US is back. That's a first really striking thing.
The second really remarkable thing is it's a very different way that leaders have conveyed that message. The Indian prime minister, Mr. Modi, the French president, Mr. Macron, have been selling globalisation. They believe in the future of a globalised economy. Meanwhile, everybody at Davos are concerned that just possibly the US is going to start a trade war.
We began to see trade policy action this year in 2018. For the first time, it was threatened. Now we're seeing it against China. What more is going to happen? Justin Trudeau was here, prime minister of Canada, to talk about the North American Free Trade Agreement. And we don't know whether that will actually continue to exist.
Mr. Trump will be here, and everybody wants to know what he has to say. The whole-- a vast part of the American administration has come here and the message from people like Wilbur Ross, the Commerce Secretary, has been-- don't worry, we're not really protectionist. We're just going to try and make trade fairer.
The dominant view is that's going to be all right. It's not going to end up as a really serious trade war. And that again means that people are pretty optimistic. But of course, we don't really know. The optimism may prove to be exaggerated. But at the end, the general feeling here in Davos is Mr. Trump is not really a threat to the globalisation and capitalist system. And everything is just rosy again.