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Ukraine's President Volodymyr Zelensky speaks during the 55th annual meeting of the World Economic Forum in Davos, Switzerland, on Jan. 21, 2025.
GZERO’s very own Tony Maciulis is in the Alps this week to report on the 55th World Economic Forum in Davos, Switzerland.
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It’s Day Two in Davos, and those of us here woke up to the flurry of executive orders from President Donald Trump, many of which were expected but still create complications for dialogues here focused on climate financing and cooperation on AI and tech policy, for example. Trump will address the forum directly via videoconference this Thursday afternoon (as we’ve been told, though there are small rumors he may come in person. I think those odds are slim, but …)
Today was a big day for keynote speeches and conversations with world leaders. European Commission President Ursula von der Leyen, Ukraine’s President Volodymyr Zelensky, Germany’s embattled Chancellor Olaf Scholz, and China’s Vice Premier Ding Xuexiang addressed the forum, focusing on trade, innovation, multilateralism, and, in Zelensky’s case, the need to rally support for Ukraine.
Also, our own Ian Bremmer offered his take on the start of Trump’s presidency in a panel discussion in the Congress Centre today. Watch here.
At the forum’s AI House, discussions today focused on mitigating bias, accelerating global adoption of AI, and AI’s role in helping safeguard the environment.
Be sure to tune in tomorrow for a special Global Stage premiere from Davos, “The AI Economy: An Engine for Local Growth,” streaming at 11 a.m. ET. The program features Ian, Microsoft’s Vice Chair and President Brad Smith, WTO Director General Ngozi Okonjo-Iweala, European Investment Bank President Nadia Calviño, and G42’s CEO Peng Xiao. Details here.
Annalena Baerbock (Alliance 90/The Greens), Foreign Minister, and Lithuanian Foreign Minister Kęstutis Budrys give a press conference at the Federal Foreign Office.
Publicly, Germany might be offering congratulations, but behind the scenes, officials there are expressing concern that Donald Trump’s second presidency could bring “maximum disruption” to the American constitutional order.
A confidential memo from Germany’s ambassador to the US, Andreas Michaelis, addressed to German Foreign Minister Annalena Baerbock, warns of Trump’s pursuit of concentrated presidential power at the expense of Congress and state governments. It cautions that Trump could politicize key democratic institutions, including law enforcement, the media, the legislature, and the courts. (In his inaugural address on Monday, Trump promised not to use the judicial system for political persecution.)
The memoalso flags the growing influence of Big Tech in American politics – a particular sore point in Berlin due to Elon Musk’s support for the far-right Alternative for Germany in upcoming national elections. Michaelis warns that X could gain “co-governing power,” potentially reshaping the First Amendment and that Trump could also take legal action or revoke the licenses of his media critics.Swedish troops of the NATO Multinational Brigade Latvia arrive in Riga port, Latvia January 18, 2025.
Sweden has sent 550 troops to Latvia, its firstmajor deployment since joining NATO in March, which ended its decades-long neutrality.
The Swedishmechanized infantry battalion arrived in Riga on Saturday, escorted by Swedish air force and naval units. Stationed near the town of Adazi, the Swedish forces joined a Canadian-led multinational brigade, part of NATO’s effort to counter the growing threat Russia represents in the region since Moscow’s invasion of Ukraine in 2022.
Why Latvia? The small Baltic nation joined NATO in 2004 as part of a wave of former Soviet republics and satellites including Bulgaria, Estonia, Lithuania, Romania, Slovakia, and Slovenia. Those are now the states on the front line of a potential confrontation with Russia — and Latvia wants to be ready. It is feared that a lightning strike from the East could cross the country in just a few hours if defenders aren’t ready to fight.
Sweden’s armed forces said the mission will ensure stability and “marks Sweden’s largest commitment yet since joining NATO” last year. According toLieutenant Colonel Henrik Rosdahl, “It’s a historic day, but at the same time, it’s our new normal.”
Ian Bremmer's Quick Take: A Quick Take to kick off your week.
I am standing here at the World Economic Forum's annual meeting in Davos, Switzerland. And of course, it's a split screen right now because everyone's also got their eyes back on Washington, DC and the inauguration for the second time of Donald Trump as president. It is the end of the post-Cold War order. That's what Borge Brende said, he runs the World Economic Forum, in a piece in the New York Times. I call it the G-Zero world, but this is the organization that's most committed to that order over the last 50 years. And of course, committed to doesn't necessarily mean fighting for. I think that's part of the issue, is that so many people, whether they were captains of industry, or media leaders, or heads of state, just believe that, well, after the Soviet Union was defeated, a united, more multilateral, globalized order was just what was coming.
And so, we didn't have to do anything. We just had to keep on keeping on. Of course, that isn't the way it felt for an awful lot of people living inside those countries. And the Americans definitively elected Trump not just once, but twice. And the first time, it was an experiment. He was an outsider to shake things up. The second time, you're electing somebody who's already been impeached twice, who's been convicted for crimes, who's already made very clear that he has no interest in promoting a US-led multilateral order. And that is exactly what people wanted, or at least, more people than wanted the alternative. And so that's where we are.
Outside of the United States, and Davos is mostly about other countries, 60 heads of state are here, and CEOs from all over the world, it’s really a question of how are you responding to that? And I would say that there's a big question of whether or not you accept it and normalize and capitulate, or whether you try to fight. And overwhelmingly, what we have is the former. I mean, the number of times you're talking about things that you never would have found acceptable, a year ago, five years ago, from the United States, cryptocurrencies being launched by the president in the days before his inauguration, making billions, tens of billions of dollars, that's just the way it's done in the United States now. Elon Musk joining phone calls and meetings with CEOs and heads of state. Really bizarre if that was happening with any other leader. But if the United States is doing it, I guess that's just the way it's done. And if the Americans are telling you we're going to take Greenland or we're going to take Canada, we're going to take the Panama Canal, well, we're not going to take that seriously, but we do recognize that we're going to have to give them a little something, because otherwise it's going to cause us a lot of damage.
One major exception here is that I don't expect the Chinese to capitulate at all. I mean, they're talking with the Americans, and maybe there will even be a meeting in the early days, a summit meeting between Donald Trump and XI Jinping. That's very different from a breakthrough deal. And rather, I think we’re at the beginning of what's very likely to be a trade war between the two largest economies in the world. And frankly, of all the things I just mentioned, that's probably the one that is going to concern the attendees of the World Economic Forum the most. Certainly, the one that's going to affect them most.
Anyway, that's where we're starting off with the summit this week. There'll be massive number of meetings over the course of the next few days and I'm sure I'll talk to you again. Talk soon.
Ian Bremmer's Quick Take: A Quick Take for you today. I want to talk to you about the geopolitical recession that we, the world, are now in. What is a geopolitical recession you ask?
Well, economic recessions you kind of understand. We have boom cycles and bust cycles. They happen frequently. So frequently that we even have solid measurements for when an advanced industrial economy is in a technical recession. That's two quarters in a row of negative growth. Or when the world is experiencing a recessionary year. They happen frequently in the United States since World War II, every seven to 10 years on average. And that means that we have been through many of those cycles, and we can recognize them and we know that we don't like them. We want to respond to them.
And whether you are an advanced industrial economy, a free market economy, or whether you are an authoritarian state and a state capitalist system, either way, you've got central bankers and finance ministers or treasury secretaries that are using monetary and fiscal tools to try to minimize the impact of a recession and get back towards effective more sustainable growth.
Okay, so that's the economic side. But I'm not an economist. I'm a political scientist. Are there cycles in geopolitics? And the answer is yes. But they're a lot longer. And because the cycles are longer, playing out over several generations, we don't live through a lot of them individually. And so, we don't recognize them as a pattern. But we are right now in a geopolitical recession.
What causes a geopolitical recession? Well, basically it's when the balance of power becomes misaligned, out of whack, with the rules of the road geopolitically. With how the world order is structured, the institutions, the architecture. So, for example, the global order that we have been living through both after World War II through the Cold War, and then through Soviet collapse, was all about a number of global institutions and architecture that the United States created with its allies, its friends, after World War II was over.
So, the world has just gone through this horrible cataclysm, a geopolitical depression, and now we've got a boom cycle. And the United States is creating the United Nations and the WTO and the IMF and all of these other global institutions with the idea being support for collective security, support for a multilateral free trade architecture, support for rule of law, promotion of human rights, promotion of democracy all over the world. Generally speaking, the United States created a whole bunch of global institutions that reflected what the United States thought about how the world should be run.
Then over time, the balance of power changes, but the institutions don't. At least not as much because they're sticky, because it takes a lot of political capital to change them. People kick the can down the road. Let somebody else do it. And when that gap grows too wide, then the geopolitical order starts to shake. It becomes much more unstable.
So, what happened here? Three big reasons why we are now in a geopolitical recession. Number one, when the Soviet Union collapsed, Russia was not integrated into the West, not into the EU, not into NATO. They're angry about it. They blame the United States. They are now a chaos actor on the global stage, at least insofar as the advanced industrial economies. The G7 are concerned, and their top allies are fellow chaos actors: North Korea and Iran. That's reason number one.
Reason number two, China was integrated into the global order, particularly the global economy on the notion that as they got wealthier, as they benefited from that, they would become responsible stakeholders. And what that means for Americans is that they're going to align with these US led global institutions and values and norms. They'll support rule of law. They'll become more politically liberalized. They'll become more economically free market in orientation. The Chinese have gotten much wealthier. They're now a technological peer to the United States, no one else is close, ahead in some areas, behind in others. But they absolutely have not aligned with the United States. And that is making a lot of Americans and a lot of American allies very concerned, and it's leading to confrontation between the two most powerful countries.
Number three, while those first two things were going on, lots of people in the West, and especially the United States, increasingly felt like their own leaders, their political leaders, their business leaders, their corporate leaders, their media leaders, their elites, were promoting globalism, were promoting a bunch of things for a global order that didn't help them. So, all of those ideas about collective security and promotion of democracy and promoting free trade, not interested, because the average American doesn't feel like they're benefiting from it.
And certainly that is a big reason why Trump won, not just once, but twice, and more decisively the second time around. And so now, not only do you have the Russians acting like rogues with allies, and the Chinese much more powerful, but not aligned with the US-led global system. But you have the Americans saying, "We're not very interested in promoting that global system anymore. In fact, we're more interested in the law of the jungle."
It's a worldview that's closer to the Chinese. Not multilateralism but just one-on-one relations where you are stronger and you tell the other country what you want to have done. It's very transactional, it's very pragmatic. Doesn't really matter what kind of values that country holds. If you're Trump, you'll do a deal with Russia or China or an ally, and you'll criticize and pressure anybody if they're not behaving the way you want to. The fact that there are common values doesn't really matter. The fact that you're part of the same infrastructure and architecture doesn't really matter. It's, "What are you doing for me now?"
So given all of that, we are now in a serious geopolitical recession. What I call a G-Zero world. Not a G7, not a G20, where there's an absence of global leadership. Now, what's very interesting about that G-Zero world, what's very interesting about this geopolitical recession that I believe that we're in is that the United States is in a particularly strong position right now. Particularly strong compared to its adversaries like China facing the worst economic conditions since the 90s, maybe even the 70s. Like Russia in a period of severe economic decline, and other decline, national security, political. And Iran, which has basically just lost their empire, their empire by proxy, the Axis of Resistance in the Middle East. The US is also much stronger relationally to its allies. America's technology capabilities becoming so dominant compared to what the Europeans, the Japanese, the South Koreans, the Canadians don't have. America's military capabilities. The strength of the US economy coming out of the pandemic compared to every other G7 democracy shows that the United States can get a lot more done in a geopolitical recession. Can ensure that its will is followed.
Also, the fact that Trump is consolidated so much more power this time around compared to 2017 when he was first president. Last time, he had all of these establishment Republicans that didn't really support him, all the way from Mike Pence, his vice president, to Mad Dog Mattis, to Mike Pompeo, to Nikki Haley, to Gary Cohn, and on and on and on. This time around, not at all. Everyone is aligned with Trump.
Also last time, the GOP, the Republican Party, didn't feel like they had to ride Trump's coattails. He wasn't as popular as a lot of they were in their own individual campaigns. This time around not at all. Trump's much more popular than them, they need him much more. And that's happening at a time when so many allied governments are very, very weak. And that's a problem, right? For them. If you're Canada and your government's imploding, or you're South Korea and your government's imploding, or you're Germany, your government's imploding, or France and your government's imploding. Or even countries like the United Kingdom and Japan where the establishment is very, very vulnerable, and very unpopular, Trump's ability to tell you, "This is what we want. And by the way, we are a lot more effective at playing the law of the jungle than either our allies or our adversaries."
It's going to be very hard for them not to kiss the ring, not to provide big wins for the Americans. So, lots of wins for Trump, and that's what we're going to see over the course of the coming year, and a lot of defense being played by a lot of those other countries around the world. But is that sustainable?
Because to get out of a geopolitical recession, you ultimately need to create new rules of the road. You need new global architecture, especially because our challenges, whether it's climate change or an arms race, nuclear weapons, whether it's AI and new disruptive technologies, for good and for bad, they all are global challenges and global opportunities. But we are increasingly fragmenting our responses to national and even local levels.
So, this is not a sustainable trajectory, and that is what we're going to spend an awful lot of time looking at over the coming year, over the coming administration, and going beyond. Because, of course, this is the first time that any of us have experienced a country, the United States, essentially unwinding, undoing its own order. These global institutions that Trump and others are saying are globalist and not useful for the Americans to align with are institutions the United States initially created to help run the world in America's own image, but the US no longer believes that that works for it. And that is a fantastically interesting, but also unnerving, unsettling, and unstable time for us all geopolitically.
So, that's what a geopolitical recession is. I hope you found this worthwhile, and I'll talk to you all real soon.
Hard Numbers: BP cuts thousands of jobs, UK drug seizures soar, Astronauts take a hike, Nigeria kills dozens of jihadists
A man walks past a Jio-bp fuel tanker, an Indian fuel and mobility joint venture between Reliance Industries (RIL) and British Petroleum (bp), in Navi Mumbai, India, October 26, 2021
5: Energy giant BP announced Thursday it would cut 4,700 employees and 3,000 contractors, a total of more than 5% of its global workforce. The move is part of a broader strategy that aims to bring down costs by $2 billion over the next two years.
3.66 billion:Drugs is big business, innit. In the year ending March 2024, UK authorities seized a record 119 tons of illegal narcotics, with a street value of $3.66 billion. About two-thirds of the haul was cannabis, and a fifth was cocaine. Elsewhere in Europe, drug interdictions have also surged – a massive Interpol operation last spring led to the seizure of more than 600 tons of narcotics or precursor chemicals. The UN says cocaine consumption in European cities has risen 80% since 2011.
7: If you’ve got cabin fever, go for a walk – if you’ve got space station fever, go for a spacewalk! That’s what US astronaut Suni Williams did Thursday, stepping out of the International Space Station for the first time since arriving more than seven months ago. Williams and her colleague Butch Wilmore were supposed to be at the station for only a week, but spacecraft trouble has kept them stranded in space, where they’ll likely remain until April or May.
76: In recent weeks, Nigerian forces have killed 76 jihadists in the country’s northeastern state of Borno. The militants belonged either to Boko Haram or to Islamic State West Africa, whose jihadist insurgency against the Nigerian government has displaced more than 2 million people and killed as many as 30,000 since it began in 2009. Growing violence and extremism in the Sahel region (which includes Mali, Niger, Nigeria, Burkina Faso, and Chad) remains one of Africa’s biggest security challenges.Deputy Prime Minister, Minister of Digital Affairs Krzysztof Gawkowski speaks during a press conference.
Georgia, a former Soviet republic that’s now independent, has facedpolitical crisis and social unrest over claims that Russia is manipulating its politics. Romania was forced to void an election result andrerun the vote late last year on similar charges of Russian meddling.
The charge isn’t new. Ukraine’sOrange Revolution (2004-05) began in response to an election result that protesters asserted had been determined by Vladimir Putin. And the charges of Russian interference in the 2016 US presidential race made headlines, though there was no evidence the Russians were successful enough to determine the outcome.
Today, Europeans are particularly on edge, because new elections are coming in both Germany and the Czech Republic. Russia has suffered more than700,000 casualties in Ukraine, according to US officials. Its ability to wage conventional war has sustained enormous damage. All the more reason, European officials fear, for Russia to use cyber strikes and sabotage attacks to pressure their governments to cut their backing for Ukraine.