Zelensky and Trump lurk in Davos
Two people are having a huge impact at the World Economic Forum and one of them isn't even there.
One of them is Volodymyr Zelensky, the president of Ukraine, who addressed business and world leaders at the forum in Davos, Switzerland. The other is Donald Trump, whose possible re-election dominates the discussion among attendees.
Zelensky used an insult to describe a statement by Trump about containing Vladimir Putin. In a question-and-answer session with reporters moderated by Andrew, Zelensky dismissed the idea that Trump could stop the Russian president from attacking other parts of Europe. Putin, she added, “won't stop, but the question is what the United States and Trump will do after this point, because in this case it will mean that Europe lost the most useful and strongest military in Europe because we lost Ukraine.”
Zelensky initially sought to calm concerns about Trump, and whether his possible re-election would cause a drop in support for Ukraine. But he also seemed a little fearful at the prospect. “One man cannot change the entire nation,” Zelensky said in the Q&A, adding that deciding on the next president is “a choice for the American nation and only the American nation.”
The Ukrainian leader acknowledged that a victory for Trump, who has opposed U.S. aid to Ukraine, could affect his country's military campaign or settlement talks. The “radical voices of the Republican Party” have created tension and pain for the Ukrainian people, he said..
Zelensky is not the only leader in Davos concerned about Trump. Several aides told DealBook that the election outcome is a potential risk for businesses, particularly after the former president defeated his Republican rivals in the Iowa caucuses.
The Ukrainian leader has sought to shore up global business support. He spoke at a private meeting of executives hosted by JPMorgan Chase, which advises Ukraine on its reconstruction efforts.
In the audience at the Congress Center for the talk were Blackstone's Steve Schwarzman, Bridgewater's Ray Dalio, Carlyle's David Rubenstein and Dell's Michael Dell, DealBook has learned.
Zelensky also spoke about how tensions between the United States and China are affecting Ukraine. It is important to bring Beijing into the country's reconstruction, given China's size and influence in Russia, he told the CEOs. But Ukraine is seen as an American concern, not a global one.
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Seen and heard around town: Traffic on Main Street was so bad that John Kerry, President Biden's climate envoy, headed to a meeting. And the annual wine tasting hosted by Anthony Scaramucci, the financier and former Trump official, ran out of wine.
THIS IS WHAT'S HAPPENING
Concerns about rate cuts shake markets. European stocks and bonds are down this morning after Christine Lagarde, the president of the European Central Bank, warned that interest rates may not fall until the summer and inflation in Britain rose unexpectedly. US futures are also lower after Federal Reserve Governor Christopher Waller signaled yesterday that it was premature to consider a rate cut in the first quarter.
Disney formally rejected Nelson Peltz's board candidates. The entertainment giant unveiled a slate of directors, including Morgan Stanley's James Gorman and General Motors' Mary Barra, and snubbed the activist investor, who criticized Disney for its strategy and succession planning. On the other hand, Disney CEO Bob Iger's compensation for fiscal year 2023 exceeded $31 million.
BP appoints new CEO The energy giant today named Murray Auchincloss as its new boss. The former CFO took over as interim chief four months ago after his predecessor, Bernard Looney, resigned for failure. disclose relationships with employees. Auchincloss has indicated that he will follow Looney's strategy of developing the company's renewable energy business and reducing its oil and gas production by the end of the decade.
The enigma of China
China delivered a double dose of bad news this morning, putting downward pressure on markets in Asia. Official data show the economy grew last year at its slowest pace in decades and the country's population declined again.
The readings are another sign of deeper problems in the world's second-largest economy, as it grapples with a housing crisis, weak consumer confidence, falling exports, deflationary pressures and major demographic challenges.
The economy grew 5.2 percent last year, compared to 3 percent in 2022, when strict restrictions against the coronavirus were in place. That was better than the official target of around 5 percent, but 2024 is expected to be tougher, with a Reuters poll of analysts forecasting growth likely to slow to 4.6 percent.
Population decline points to greater challenges. The country recorded more deaths than births for the second year in a row. Beijing is worried that fewer people means fewer consumers and it needs working-age people to drive growth. Retail sales in December were also below expectations, while industrial production barely beat them.
A post-Covid boost has not materialized. “Chinese authorities and some international economists believed that China's economic downturn in recent years was caused by the “Zero Covid” policy,” Yi Fuxian, a scientist at the University of Wisconsin-Madison and an expert on Chinese demography, told DealBook. . “But China's economic recovery was much weaker than expected last year, as the main drivers of the slowdown were an aging and declining workforce.”
Structural reforms are needed to address these new realities. But in the short term, China will continue to rely on export-led growth at a time when many Western companies are already looking to move parts of their supply chains elsewhere.
