Swiss scene offers Asian focus

PUBLISHED : Tuesday, 03 February, 1998, 12:00am
UPDATED : Tuesday, 03 February, 1998, 12:00am

For the chance to rub shoulders with the world's power brokers, there was only one place to be over the past six days, the small ski resort of Davos in Switzerland.

There you could start the day with Microsoft mogul Bill Gates, discuss genetic engineering with a Nobel Prize winner, take lunch with financier George Soros and hear Vice-Premier Li Lanqing rule out devaluation of the yuan.

You could catch Hillary Clinton's views on the priorities for the next century, listen to a couple of presidents and prime ministers and round off the day by brainstorming with a panel of experts on the future of Asian economies.

The brainchild of Switzerland's Klaus Schwab, the annual World Economic Forum in this small Alpine town has carved out a reputation as the place where leading politicians and businessmen - together with a goodly sprinkling of scientists, writers, artists and journalists - can rub shoulders beneath the snowy mountains and discuss the state of the world.

This year, despite all the meetings on everything from management strategies to cleaning up the environment, it was the situation on the other side of the world in Asia that preoccupied the thinking heads of Davos.

International Monetary Fund patients South Korea and Thailand got consistently good marks from a series of panels and pundits. Indonesia scored considerably less well.

There were some tough private warnings from the United States that Congress would react with extreme disfavour unless there were real reforms and would refuse to provide funds for the IMF to 'throw good money after bad' if Indonesian President Suharto did not do the right thing.

But, as the discussions moved from one wood-panelled chamber to another, the biggest target turned out to be Asia's largest economy. Japan, everybody seemed to agree, must inflate demand, reform its financial structure, get its growth rate up and generally do all the things it has shown itself so reluctant to do in recent years.

The question, however, was what effect all this Nippon-bashing would have. Despite the weight of disapproval, the signs were none too promising. As the denunciations rolled out, the smile seemed to grow ever broader on the face of the leading Tokyo delegate, Vice-Minister of Finance for international affairs Eisuke Sakakibara, whose influence on currency markets has earned him the nickname 'Mr Yen'.

He pointed to the economic package Tokyo tabled last month, but made it quite clear Prime Minister Ryutaro Hashimoto was not going to be rushed into precipitate action. The new measures would have to wait until April to be passed by the Diet, or parliament. Asia and the world would have to wait.

By then, warned one economist on the platform beside him, a new downward spiral might have got under way in the region.

No, said Mr Yen, action would have to wait for the Diet process to be completed. For all the warnings of fresh disaster ahead unless Tokyo moved fast to pump life into Asia's economies, the Japanese remained, as usual, immovable. There are, it seems, limits to what even the weight of Davos can achieve.

Still, the Alpine air has had an effect on some people.

Currency speculator supreme George Soros said if there was another financial crisis the world should have an international monetary insurance fund to put a lid on the instability - and, presumably, to stop others making fortunes the way he did.

At lunch on Sunday, Bill Gates said he might spend the first two decades of the 21st century learning how to be humble.

He did not have much idea how to go about it, he confessed. So he invited guests to submit suggestions - by e-mail, naturally.

The Swiss Alps are traditionally alive with the ringing of cows' bells. During Forum time the ringing comes from mobile phones instead. If there is any place that can outdo Hong Kong in mobile use it must be Davos over the past few days.

But the conference organisers are draconian in banning use of mobiles during sessions. The withdrawal symptoms can be severe.

One man sitting at the front of a session I was chairing kept pulling his mobile from his pocket, stroking it as though it might be feeling neglected and, at one point, raising it to his ear and mouthing silent words into it. I caught his eye. He smiled like a child caught misbehaving and slid it back into his pocket.

As soon as the session finished, he bolted out of the door and was deep in conversation by the time I reached the corridor. He was probably just booking his place on the ski slopes.

Important as Asia may have been as a topic, you still could not expect to escape from 'Monicagate'. The Lewinsky-Clinton jokes ebbed and flowed round the coffee tables and bars. Most were unprintable; some were even funny. But what was most striking was the way most of the non-Americans simply could not understand how the most powerful nation on earth could be obsessed by the allegations against its president.

'After all,' as a Frenchman remarked, 'it's only sex'.

But that did not stop one leading US official from admitting he was weighing his words particularly carefully - not for fear of making a policy miss-step, but in order to avoid unintentional double entendres about American affairs that might distract from the seriousness of his message.