 Good afternoon everybody Warmly warmly welcome all of you come to this session so I'm Please an honor to chair this session under with the chair and the founder for the world economy for it I guess you don't need a very much introduction for Klaus Schwab. Everybody knows him He is a visionary 44 years ago he see the world need something to bring the leader together So he started building the world economy forum in a small town in Switzerland called the Devils But the forum grow grow strongly strongly from Devils to Dalian from Dalian to Dubai to the whole world and He's very Innovational because he brings so many initiatives To the program Today the forum have industry initiatives have global agendas have a regional initiatives Bring the young leader all the world to the forums. There's so many ideas He's always innovative says all the ideas in his head. He's amazing and He's a true global citizen as say The Really the mission for the forum is committed to improving the state of the world I recall two years ago. I was in Jordan attend the regional forum of Mina in that meeting he bring 400 business leader from Israel bring 400 business leader from Palestine Those the business leader together to propose a peace initiatives He say the business people not only try to do business, but also try to promote the peace So 400 people together to say the business people should get together to promote the regional peace It was a very very moving move It also bring President of us the price of Israel the secretary general of the United States Carry John Kerry So sit down to talk about how business community can facilitate this peace process I was lucky enough to have opportunity also attend this meeting as well So he's always think about the global issues not only in the business, but also in the political social issues and particularly in the peace and improve the humanities and Also, he's a great friends of China Nine years after forum set up in in in doubles The doubles who received the first Chinese delegation, which is 1979 that year China start reform nine years ago here in Dalian the first time the forum moved out as foreign from doubles to the seaside city Dalian and In the past between the two nine years 1979 to the nine years ago today roughly 36 years He read the China many many many times You always truly believe the future of China and he always loved Chinese culture and the belief in the Chinese people but at all is an Old the Swedes men a gentleman with a lot of characters Really a lot of energies a little bit of stubborn Which is a typical character of a Swedes You know if you dreaming about your office location You will say the best idea is my house is next to my office or my office and next to my house Which is exactly the situation in the in the headquarter of the water conferring in Geneva His house is the next to the head office of the water clan for him How happened? really Klaus bought his house first and He always wanted to buy his neighbors land to build the head office for the water conferring He tried to beat his neighbor tried to convince him to sell land to him so he can build a head office for the water conferring He understand that his neighbor like to drink So any time he beat the neighbor he bring a good bottle of Scotch he drink the the Scotch you wait the neighbors never say Don't talk about the land talk about everything. Let's drink So they drink a complete the bottle of the whole thing the first visit So then after six months he visit his neighbor again, then they will say Don't talk about land just a talk and drink so they drink the whole bottle of Scotch and Talk again in the next 15 years 15 years to visit to his neighbor 30 time They drink total of a 30 bottle of a good Scotch So finally His neighbor passed away You can guess why? So the widow called he said my husband passed away They told me if you want to sell land you have to first off class So Klaus bought land and the build a beautiful Headquarter of the world Ignorant Foreign next to his house You see how Persistent this person it is So please join me welcome the chairman and the founder water conform Klaus Schwab Welcome. Welcome. Thank you. Thank you, Min. I have only one regret So it was whiskey and not Mao Tai But listening to you mean I have to say if my mother would still be alive and Had listened to you. She would be really proud of me But no, thank you for this Introduction Now I'm here to answer questions Good good class and I was wondering whether you chair the session or I chair the session was when you start to talk Yes, please. Let's sit down the first issue is What motivated you to set up is the water conform not say Cloud Schwab chocolate or Cloud Schwab watch Or Cloud Schwab University or whatever. Yeah No, when we when we look at the world and when we look how the world has developed over the last Four or five decades. We see the following developments. The world has become much more interconnected Not only that countries and regions and businesses have become interconnected. I think there's also a much higher Interconnection today between politics business civil society Academia and so on so when I created the forum my intention was to create a platform where the leaders of the world could come together and To shape the future shape does not mean that they decide about the future But they have to understand the future through dialogue And they have to look if possible for a solutions That was the original sit on the wrong side. Yeah Now we have our identity again No, so the world needs a platform where really leaders from all walks of life can come together That was the idea Leaders from politics leaders from business leaders from civil society But what's very important today also is to engage into this dialogue So best minds and that's the reason why you see so many scientists here so many people from universities I think they have a lot to contribute to shape the future and in addition. I feel in a world, which is World's the medium age is 26 or 27 I think it's very important to also engage the young generation Into this interaction to determine the future. So that was the that was the fundamental idea and I have to say I never dreamt of Let's say the success the organization would have now with close to 700 people all highly trained but What has happened in the last 40 50 years The need for such an organization became more and more apparent and that's the reason why we are so successful Well, thank you. You mentioned shaping the futures you emphasize over time This is a very important concept and idea and you had 44 years ago Now what the role the water can inform to play in that particular principle and in today's international war you see mean There are many organizations international organizations in the world which help to integrate the world, but they are all departmentalized you have see you have see International Monetary Fund probably as the most important organization together with you and they are very important But you are focusing on Financial issues economic issues mainly so you have the World Trade Organization looking at trade issues You have the World Health Organization, but today most of the issues are interconnected and What we can do is to provide a platform we'll see decision-makers from all sides come together and exchange ideas look at possible solutions And in such a way we can act as a catalyst for new ideas. I should add one as a point When we look at the political system today the political system is and and to a certain extent also the other systems We are very much absorbed by crisis management So we are running after let's say what's happening in the world at this particular moment There's very little time to look really at the future just takes the impact of new technologies just think for example of big data or think of Self-driven cars self-driven cars is a good example He needs the dialogue of the automobile industry of the battery industry of the Computer industry it needs to integrate mayors of cities. He needs to integrate as the insurance industry It needs to integrate even See of course and foremost he needs to integrate Governments in order to set the necessary regulatory system so Today we are living in the ecosystem and I repeat where everything depends on Many other factors and so forum in some way is First an integrator to bring everybody together and a catalyst to look more towards the future and less towards the past Mm-hmm Now as you said you never expect the for a for forum to be such Successful and grow rapidly today you have more than 700 people working for you have all these top or activities and You bring not only the business leader But also political leaders intellectual leaders opinion leaders social meetings all those things together Now in my life also I saw forums you know in and around right? I mean so many different forums But you are very successful. What's your secret? first I I would say our age Over 44 years we build step-by-step confidence and trust So we are today a trusted partner of governments and business International organizations and so on But second We are completely neutral Non-political we are platform so People can come to exchange their ideas without feelings. They are exposed to certain Specific expectations they can Really interact so That's those are two factors. I would add one one factor I was always fortunate to to be surrounded by excellent people Who helped me and what's most important is the forum is not a conference organizer? Even if meetings play a very important role because they provide the basis for creating trust and confidence you can speak out but The forum is an ongoing process. So we have many many initiatives and Our meetings serve for practically all the sessions here have been prepared Those who task forces will be filled up. So it's an ongoing process I take for example, we have a big initiative on the future of the internet because The internet is in in some ways a live stream for the economy Of tomorrow, so we have about 20 people in Geneva working all the time But not only those 20 people we have engaged business We have engaged governments on a long-term basis. So I would say 20% of our activities are devoted to To conferences but 80% it's the work which is done behind So substantive work 20% in conference 80% of behind that's a really interesting Amazing structure because we all thought The forum is a forum, right? It's a conference. So it's not what are the as a other 80s activities If you can give us some examples in principle We have Three types of activities in addition to the conferences. We have initiatives which are relating to the big global issues for example Mean We you know we we have one initiative looking at the future of the financial system and here of course the best partner is the is the IMF but as the monetary fund but You are looking at the present issues. What we are doing is looking how new technologies Digital money and so on will impact on how On on the banking system on the financial systems around the world so we have Another initiative on let me just go through the initiative. You may have seen we published this week also in cooperation By the way with your organization, but also with the World Bank. We see OECD we everybody speaks about how to how to combine Economic growth and social inclusion and some people feel so it's even in contradiction You can either easily pro-business or you are in favor of social inclusion now. We have developed a conceptual Framework we chose and it contains 17 different factors. We chose that actually Policies which foster social inclusion and policies which foster Economic growth are compatible and are even reinforcing each and do another. You know also our our work in the competitiveness area Where we measure governments around the world on the basis of their national competitiveness. So there are a lot Of initiatives which are related to global issues Global comparisons and so on but then we have the regional activities So for you referred to the meeting in the Middle East So forum since the beginning I believed very much in What we call a merging markets and the fact is that I invited The first Chinese delegation as early as late 78 to participate 79 at the annual meeting. I think is a proof of our commitment to engage countries not only when they are powerful, but also when they are in undergoing development and So we have regional Activities we have for example initiative how to create jobs in the Middle East because we feel This is absolutely essential to to give those people as a feeling of a future so We have activities Regionally in Latin America and in in Africa in the Middle East in East Asia Of course, we are very present here. And finally maybe most important for most of you are our activities Related to different industries today Insights of home we have 20 different industries Each of those industries is undergoing substantial change With the new technologies The health industry will look very different in 10 years from now Transportation logistics industry will look very different and I could go on and so on and we help the industries to recognize the changes they have to face and See Policies they have to undertake to master the future Now you mentioned China You visited China many many times, but although I heard I'm not sure You're not a particularly like hot and spicy Chinese food and But the questions Why is China? Why do you think it's important to Bring China to the foreign and what is the cooperation and the relationship between the China and the forum today? If you if you allow me mean I just would Be a little bit personal As fast China is concerned when I came first time here in 79 I was invited and it was invited in the old Beijing duck restaurant and I didn't know Mao Tai and I was off of Mao Tai and Having no idea about how strong it is. I drank 14 Mao ties and It gave me a very bad reputation. That's the beginning and as far as spicy food is concerned I like so much spicy food and Two weeks ago see Chinese ambassador in Geneva invited me for dinner and Very polite he asked my office What food I would like to have and my office said very hot food so So I got the wrong information So the ambassador asked of course his cook to to to provide to cook very spicy food and It was so spicy. I liked it But I was wondering why nobody around at the table really ate this evening So you can't eat a very hot and spicy food. Oh, that's wonderful. So what about the relationship and the cooperation with China? China is possible they can make for very important. I I When when I came first time to China 79 and send every year at least once sometimes two very often even three times I Felt a special affinity with this country. I like the culture I like the people I'm a very Curious person So we started actually our first meetings as early as 79 and At that moment nobody would have read it would have sorts of China in the year 2015 would be the second largest economy in the world. It was my belief in China which Let's say created a special attachment to China today, of course, it's not only An emotional reason. I think it's also Rational consideration Nothing can happen in the world anymore Without China you have seen how See Troubles which we saw as Stock markets had a ripple effect around the world which in my opinion was not justified because it was Taking a two short term view but We we want to make sure there's a lot of discussion what what what It's a place of China is in international organizations like also New organization for us in any case China is a partner In its full rate And we would like to engage China not only in our meetings Of course, we have great participation But we would like to engage China in the other plate 80 percent what we are doing in the different initiatives for example takes the infrastructure initiative which we have And We work also together by the way very closely always with the country which has the presidency of G20 so I will be At the next G20 meeting in Ankara In in the south of in Antalya in the south of Turkey. We have been associated with the work since quite some time But we would like to to to make sure that Chinese Governmental institutions and business Is very much universities are very much engaged in the ongoing work of the world Good. Thank you. Let's come back to the cooperation with China because you focus on the other 80s I think that's really a big area, but I think that many people here may have a question in the comments To Klaus I think at this time probably it's a good time to open the floor. So anyone Have a question or comments or please Make a question or comments and show identified. So I see the hands in that corner. Yes gentlemen, please Yes, please you need a mic. Okay, Mike is coming Well, I'm Prakash Hinduja from Hinduja group of Companies I would like I have a very high regards for professor. Sure. I've been knowing him for last 33 years attending Davos all the time as I've been here in Dalian for the first time I would like to ask him a question as he knows India and China both the country so well What would be his energy? With this financial crisis which have taken place in China How could India and China complimentary benefit from each other? I would like to have his Advice in this particular issue Thank you Thank you, Mr. Hinduja And thank you for your loyalty and your your partnership I'm very optimistic about the future. Let me start first with China Of course You cannot grow Continuously Ten percent because I was calculating I was calculating if you if you grow by ten percent and you have a volume of Cheap a national GDP of one trillion which was the case about 14 15 years ago Then you have to add with one trillion you you have to add 70 no seven now I have to with ten percent You have to add hundred a billion To your to your GDP But if you have the gross if you are an economy as China is today if I'm not mistaken of Ten trillion and you grow by ten percent you have to add an economy of society of Switzerland or Indonesia To the economy and this is I mean we not sustainable over the long run So I think there will be a new normal in in in China But still a new normal with very high Gross rates in a global comparison now India is a Late starter if I may say so now this with The new Prime Minister See macroeconomic microeconomic conditions are are created to to To do is a catch up, but I'm not it's not Chinese versus India I think it's China and India and I'm very happy that's the we see Silk Road initiative and so on that's the two countries will move closer together by strengthening communication roads and so on so I Think it's it's wrong to say either all I Think it's as well China as Thank you any other question or come yeah the gentleman in the middle. Yeah I'm helping Chinese companies to do overseas investment I'm with a Henry corporation helping Chinese with internationalization in 2014 China become a capital outlawing country instead of a inflow country therefore a lot of Chinese companies make international investment Well We have a stake owned companies and private companies and also high-tech individuals So will the forum help Provide more support and assistance or or provide a bigger platform Broad what the forum can help them provide the useful recommendations and a consultation I I first welcome the internationalization of China's business and if you live in Switzerland Look at our big Companies Nestle rush RBB They have more than 90% of their operations abroad Why shouldn't the same happen? Of course China has a much bigger internal market But in a globalized economies that companies go abroad should be encouraged Now how can the forum help I think what is very important for Chinese? Business leaders is to understand the global context to see To create trustful relay relations. I think it's very important Not just to invest But to come become true partners and if you want to be a partner I think you have to understand the Environment see political see economic environment and here's a forum can help very well. I'm I'm For example, we have a very big meeting in it see the most important meeting in Africa the most important meeting in East Asia We will have a big meeting in In India I'm always a little bit surprised how few Chinese are participating So those are the best opportunity to really understand and to feel What's the situation in the country is and when you have this feeling this sensitivity? I think Sun you will establish also the necessary base for being trusted and Not just be an investor but a trusted and welcome to investor so this is very interesting advice and Close what I think close try to say and before your company move out They should attend the more water come forum conference to understand what is the global situation? But I guess the clothes a little shy You should invite him being your member and you can give him a discount fee exactly Why oh the gentleman have a follow-up question No, no, I'm sorry. I cannot give you. I saw the lady behind. Yeah, lady behind Yeah, then the lady from okay the lady behind the second. Yeah Hello, Mrs. So I have two questions and I'm not sure which Do you know I'm not sure how much you know about China's Economic now and you know your you choose darling to help the world for economic forum And darling is located in northeast of China And you know the economic of northeast is not a really a problem for Chinese government Governors and because of in years ago, it is it is the Big brother of China's cities China's Regions, but but now it is They have been the they have fall fallen behind a very very very behind and do you have any advice for the local governors to Stimulate the economic That's Classes a challenge because they ask you to provide the advice for the local government in the Dalian and the region First, thank you. There was thank you for your question and first we are We are loyal we started our meeting here when Dalian was and At some time also Tianjin we're at the forefront of interest Now I know the south of China Shenzhen and so on have Developed very fast and are very attractive But we are loyal to our old friends and maybe even now our presence is more needed here than before as far as Advice to the local government is concerned I would say we So north is very much still Structured to a certain extent Not Dalian necessary, but around traditional industries and what we are speaking here about It's mainly science technology innovation and sustainability. So my advice would be Promote promote innovative industries. They are the future Thank you. I guess the lady come from sauce Guangdong or Shenzhen. Yes, the girl behind Yes, the lady. Yes There's a saying goes that The downturn of Chinese economic the devaluation of R&B and the instability of Chinese Stock market caused the word stock market fell. How do you think about that? And another question is for Mr. Jew that No question for me. I'm the moderator Okay, you can hold our question Okay, just for you both. How do you think that? For R&B to realize the Internationalization, how long does it take to realize that? That's my first question is very close on the current China economic situation. Yeah. Thank you I As I mentioned before, I think we have to look at the long-term Potential of China China of course has some imbalances, but I'm I'm Confidence that's those imbalances well managed As I said before I my outlook for China is positive and The new normal will be very well managed. So I think We also have to Make a distinction between speculatory moves at the stock exchange and really long-term placements and investments Thank you Any wow is a lot of hands. Let's have a gentleman here in the in the front Your first and the lady are also the gentleman yet that they are in front of the gentleman. Yes Yes Just want to ask about this China threat That is going around this token It's the West really comfortable with the strong China or is the West actually want do not want China big to come So strong anyway No, I think everything I have said shows that We we have contributed even To Creating the strengths of China if I if I look if I look back and it's now Over 30 years. How many foreign investors we brought into this country? I remember when I came when I came first here in 79 it was the beginning of The interest of many companies. I just want to quote Volkswagen for example. That's what I'm shindler So I always I believe in in the world. So should be strong who are the most intelligent the most hard-working and the most committed people not only to to that's very important and If you look at our slogan improving the state of the world I think it's very important to develop the economy But at the same time to exercise social responsibility and this is something Many if you allow if I allow me two comments Related to the world economic forum again. So first one is We do not only for store And help business to grow or countries to grow. I think social responsibility Social inclusiveness is a very important element in everything what we are doing and you meet here also Quite a number of social entrepreneurs Who we have invited which means people who are entrepreneurs? But not in order to make money but in order to help humanity So a great examples here, and I I would advise you to talk to some if you allow me One one additional comment coming back to a earlier questions the 80 percent answer 20 percent see let's say the work which we are doing on a continuous basis and See see conferences We do not charge for our we are we are different from them from meetings We do not charge anymore for our meetings Davos is Winter Davos is a little bit different for tax reasons Swiss tax reasons, but We want to have people we want people to be part of a community Part of a community which works together to shape the future in the spirit of committed to improving the state of the world So we do not charge for meetings We are financed by partnerships and memberships and this expresses the will and the concept to engage people as members on a long-term basis and we are in a fortunate situation Is that we have waiting lists practically for all I see here my colleague More at some less with our chief business officer we we have we have waiting lists and We engage only people into our membership and to our partnership where we know They can make a contribution not only to the forum, but to the world Yeah, and the other yeah, I saw the lady in the front. Yes, please Then I'll come back to that gentleman. Okay. Yeah, thanks, Dr. Drew And good afternoon Dr. Shua first of all, I must say that you look much younger than reality. Oh I like to hear I like to hear that one Yeah, and then we all know that what the economy forum would not be that successful without your reputation But my question is how would you select your successor to continue its success? Will it be your capable son or other? executives What kind of changes do you expect in future? You know when the lady have a nice was to you You always have a tough question That's a tough no even tough than the gentleman One he had yeah, no first the forum is not a family enterprise It's an independent foundation. So only the best will succeed But We are now recognized by the Swiss government also as a official international institution and we just adopted Adopted by It has been adopted by our board of trustees a framework of statutes and bylaws which are our role model for governance of an international institution So we have all the regulations in place to make sure that one day see the forum Needs a successor and I can't guarantee you No, I cannot guarantee because we don't know but at least it's my will so that it will not be very soon But when the forum needs a successor The regulatory framework is here in addition in addition. I People look at the forum only Only or very often only at Klaus Schwab but actually I have a managing board with Every every large company would envy me for See talents. I have assembled in my top board I have the former vice chancellor of Germany's a former Foreign Minister of Norway the former CEO of SAP which is one of the largest company the former global advisor of the president of one of the biggest countries in the world Former leader in high technology in Silicon Valley So I have all the elements inside the board best people and below the board We the forum has the form is the biggest employer of top school graduates in Geneva So we have us. We have a forum is about 35 out of the 600 About 35 have a degree from Howard University just to give you one university We have Yale and all the other universe. We have also from China Chinese University, Qinghua and so on so the forum is a big Treasure of human resources and Klaus Schwab Plays a role to coordinate everything, but it's a force which goes far beyond our Klaus Schwab That's a very nice answer cloud. I know this We just to transform the forum into International institutes Which is very unusual. I recall in the board meeting you proposed idea two years ago We had a lot of debating a little confused. We're not all clear How can we transform the form into international institutes? Which is very new because we never thought such a top of institute to promote public a private and Partnerships why you want to transform into the ink international institutes? What is new institutes? Well Function in the future The forum was originally set up as a not-for-profit foundation now the forum plays more and more a important role assisting official global governance systems, so We Recognizing the situation the Swiss government Concluded a official agreement with us So we we are Institutionalized by government degree and the reason is said We as the international institution for public private cooperation are Anchored as well in the private as in the public world. We are not a voice of business we provide a platform for dialogue But dialogue between business and the public side It's very important and by the way, it's also expressed in our governance system I'm the founder but we have a system where I report to a Now to a governance board and to a board of trustees and the board of trustees is composed according to the concept of the forum by One-third about our leaders of international organizations like Dr. Chiu Christine Lagarde the head of OECD and so on and so on One-third our personalities from civil life and one-third our personalities from business You are I think we have outside we have Our latest annual report which we just submitted to the board of trustees And you are totally invited. We have it also in Chinese So you are totally invited to look for details into the report Transform into this a new International institutes. It's a really a big step for forum. It's very important because we have now We are not just we are not an international NGO anymore We have the same status Like the international Red Cross. I'm F or I'm F is based on the intergovernmental arrangement, but we have the same status like the Olympic Committee and of course Having this status we enjoy also all the privileges of an international organization in Switzerland and abroad like For example, I have diplomatic passport. We have We have tax exemption and I could we can hire from all over the world And of course It it makes also sure to come back to the last question. It makes also sure that we really not only Design and adopt but Live up to the highest governance principles, which you can have in the world Yeah, no, this is a big move in in Chinese words. I think it's a new long March And I think this conversation can go forever. I'm unfortunately will have only 40 Unlimited it will go forever. It's actually in Switzerland. It has become a law. Yeah, exactly So that's a very important step now on given the time limitation I have to close the whole session here and I would like to take these opportunities to ask everybody to join me to give a big applause to Clouds and that we hope we wish you look even younger every day And as a lady says and also wish the forum ever success Thank you very much And thank you for your interest and you can be assured that we are here to serve you to serve China and to serve the world Thank you. Thank you