INTERVIEW: Mirek Dusek — ‘This is a watershed moment for the Middle East to think anew’

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Mirek Dusek (Illustration: Luis Grañena)
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Updated 11 November 2018
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INTERVIEW: Mirek Dusek — ‘This is a watershed moment for the Middle East to think anew’

  • In the UAE to help prepare for Davos 2019, Mirek Dusek says globalization must adapt to prosper in a ‘multiconceptual’ world

DUBAI: The World Economic Forum show rides into the Middle East this week, and for the next couple of days Dubai will play host to a gathering of global thought leaders, captains of industry and policymakers in the forum’s “global futures councils,” preparing the agenda for the big annual bash at Davos in January.
It is Mirek Dusek’s moment in the sun. As WEF’s head of affairs for the Middle East, he is the expert on regional matters. As a member of WEF’s executive committee, he is the coordinator for Middle East matters in the global debate that emerges at the annual meeting in Switzerland.
“Overall for us as an international organization, everything revolves around the flow of knowledge and activities, and making progress on the mission that we have of ‘improving the state of the world’,” he said.
“So this specific meeting of GFCs (global futures councils) in Dubai fits into that framework because it has a very unique role. It acts as our advisory board, a board of 38 councils that have the top experts in their respective topics,” he added.
He believes that the connection between the meetings in Dubai and Davos will be even closer this year — the third year the futures councils have convened in the UAE — because of the agenda that has already surfaced for the January meeting.
The WEF last week announced its grand theme for this year’s Davos — “Globalization 4.0” — and the UAE has played a prominent role in the global globalization story, even if that has lost some of its lustre recently, as Dusek recognized.

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BIO:

BORN 

•Prague 1979

EDUCATION

•University of Reading, UK

•Kuwait University, Arabic language studies

CAREER

•Director, US Embassy, Prague

•Public diplomacy specialist, US Embassy, Baghdad

•Global Leadership Fellow, WEF

•Head of Middle East and senior director, WEF

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“The latest round of globalization started in the 1990s and, despite impressive gains in terms of lifting people out of poverty and driving prosperity in many corners of the world, it has also led to many cases of inequality of income, and we’ve also seen the rise of populism.
“We want to make sure the next iteration is right so we get a future that is more inclusive and sustainable,” he said.
“It is really about ideas and imagination and being able to step back and think a little long-term about what kind of framework we need to ensure that the next wave of globalization is more inclusive.”


The subtext of the Davos theme in 2019 is “shaping a global architecture in the age of the fourth industrial revolution,” which is another concept that has been forged by WEF founder Klaus Schwab — the confluence of technology, communications and biology to radically change global economies, labelled 4IR.
The “architects” who will gather in Davos will get a lot of their “intellectual underpinning” from the Dubai councils, he said.
Last year, the UAE meetings focused on cybersecurity, which led directly to the creation of a permanent center for cyber-security in WEF’s Geneva home.

In the case of Saudi Arabia, attention should be paid to the labor market, the innovation ecosystem and education.

There are also likely to be further practical examples of cooperation between the UAE and WEF, with the Emirates in tentative talks to be an affiliate center for the WEF’s San Francisco-based 4IR hub, as well as a joint initiative on data policy.
Another big element of thinking this time round will be in what the WEF calls “the new metrics.”
Dusek said: “If we really are talking about changing the way we see things in the context of globalization 4.0, we have to have the right lenses for measuring progress. Gross domestic product has been around for a while, but it does not really tell you much about happiness or wellbeing.”
This has further resonance with Dubai in its recent focus on “happiness” as a central goal of policymakers.
The Middle East has not, in terms of peace, tranquility and security, always been regarded as a center of global happiness. Dusek’s overall assessment of the region’s condition focuses on four main areas, where there is work still to be done in many details.
The first is how the Middle East reacts to the big structural changes taking place in the global economy, summarized in 4IR.
“We really need to see functioning policies to create ecosystems to successfully compete in the economy of the 4IR. It’s important that the region stays on the front foot in this new era, and does not only behave as a consumer or observer as it develops,” he said.
Second, Dusek recognized that many economies in the region, including the biggest in Saudi Arabia, had begun to prioritize reform as a means to growth, but still faced challenges in terms of youth unemployment and inclusion, especially of women.
“Some economies in the region have a significant starting advantage in the form of energy endowments that can be employed to accelerate and leapfrog many economic and social challenges. This is a watershed moment for the region to think anew,” he said.
Next, and of major significance, is the global question of environmental change. Dusek believes this regional issue has yet to be given the prominence it has had elsewhere in the world, where it is a political priority.
The region faces a permanent challenge in the supply of water, which recently came to the fore in disturbances in Basra, Iraq. On this and other environmental issues, “we think now there is an opportunity to elevate the discussion to the level where it should be — with business leaders and political leaders.”
Finally, the perennial regional issue of geopolitical and security fragility is on his mind in Dubai. On the question of Iran as the US wields new sanctions, he reiterated the long-held WEF view that “the best way to resolve misunderstandings or any dispute or conflict is through dialogue.
Schwab coined the term a “multiconceptual world” for one where different powers have contrasting historical and cultural legacies. “So how do we architect a different system of cooperation that will enable some common ground but also not put at risk the internal dynamics of the countries that are involved?” asked Dusek.
He does not name any country specifically, but Saudi Arabia over the past year seems to have exhibited many of the challenges of multiconceptualism: Progress in some areas, such as women driving, has contrasted with lack of progress on some of the items in the Vision 2030 strategy that were so promising a year ago.
Dusek stressed that the WEF takes a long-term view of economic change, not focusing too closely on short-term headlines, but he said the Kingdom could take some comfort from WEF’s annual ranking of global competitiveness, in which it jumped six places to No. 39. Also, he said, the rise in oil prices in the year had made for a more stable economic outlook.
But challenges remained. “In the case of Saudi Arabia, in our view attention should be paid particularly to the labor market, the innovation ecosystem, and the quality of education and skills needed for the 4IR,” he said.
Saudi Arabia has been a committed long-term partner of WEF, with big corporations such as Saudi Aramco and Sabic among its core membership and prominent participants at Davos.
That relationship looks set to continue regardless of global distractions. “We are, of course, welcoming representatives of all the strata and stakeholders from Saudi Arabia to Davos. We will welcome government officials, we will welcome global shapers and young people from the Kingdom. We have a well-integrated relationship with business leaders from Saudi Arabia. Those are the key communities of WEF, as they are with other countries, and I’m sure they will be manifesting themselves at WEF,” Dusek said.


India names Modi demonetization backer as cenbank head

Visitors are seen standing next to a logo of the Reserve Bank of India (RBI) at the bank's head office in Mumbai on December 5, 2018. (AFP)
Updated 12 December 2018
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India names Modi demonetization backer as cenbank head

  • Das — a high-profile backer of Modi’s controversial 2016 move to scrap high-value currency notes, known as demonetization

MUMBAI: Ex-finance ministry official Shaktikanta Das took charge of the Reserve Bank of India on Tuesday, in a swift appointment expected to ease a dispute with the government as it pushes for looser credit rules ahead of a general election.
The announcement by Prime Minister Narendra Modi’s administration came just a day after Urjit Patel resigned from the post, following months of clashes between the two institutions over lending curbs and how to deploy the central bank’s surplus reserves.
Pressure on the RBI to take immediate steps to boost the economy, including a transfer of the excess reserves to the government, could well rise after Modi’s ruling Bharatiya Janata Party (BJP) suffered likely election losses in three key states on Tuesday.
Das — a high-profile backer of Modi’s controversial 2016 move to scrap high-value currency notes, known as demonetization — will serve a three-year term as governor, effective immediately.
RBI watchers said they expected the 61-year-old, who retired last year as secretary of the department of economic affairs having previously served on the RBI’s board, to put relations between the Mumbai-based bank and the finance ministry in New Delhi on a stabler footing.
Investors will also look closely at his ability to hold up against outside influences after recent efforts by the Modi government to gain greater control over the central bank’s regulatory powers.
“The incoming governor will have to work hard to prove that he has his own independent mind,” said Deepak Jasani, head of retail research at Hdfc Securities.
Investors said any openly political appointee with little macro-economic experience, would not sit well with financial markets that already sold off following the BJP’s election setbacks.
But Ashish Vaidya, executive director and head of trading at DBS Bank in Mumbai, said he expected India’s debt and currency markets to react positively.
“He is a bureaucrat...We expect the RBI to take a pragmatic approach under him, be pro-growth and change its stance going ahead given that inflation has come off sharply,” he said.
Finance Minister Arun Jaitley told Reuters partner ANI that the government acknowledged the bank’s independence.
“Government will fully support the RBI and coordinate with it in areas where consultations of government are required to make sure India’s economy benefits from both government policy decisions and areas which fall within domain of the RBI,” ANI tweeted, quoting Jaitley.

SWIFT APPOINTMENT
Pronab Sen, India’s former chief statistician, said he was surprised by the speed of Das’s appointment.
“If you have a situation where a position as important as the governor of the RBI is filled within 24 hours of the resignation of the incumbent, that will raise eyebrows,” Sen told Reuters.
“People are going to say, clearly this guy had already been identified. And, the situation was created where Urjit Patel had to quit.”
Das — widely seen as a contender for the top RBI job after Raghuram Rajan’s term ended in 2016 — did not answer calls from Reuters to his mobile phone.
RBI officials who have worked with him closely said Das was likely to be more inclusive in the decision-making process than Patel.
“He has a balanced approach and is good at consensus building,” said a former deputy governor. .”..We have had our fair share of differences. But he has always been solution-centric rather than festering on those differences.”
Das worked in the finance ministry under both Modi’s government and the previous coalition led by the main opposition Congress party and was also involved in drafting the Insolvency and Bankruptcy code aimed at protecting small investors.
He came under fire for his pro-demonetization stance and was the most vocal bureaucrat at the time Modi withdrew the high-value bank notes to fight tax evasion.
Das last year criticized the methodology of global rating agencies and sought a sovereign rating upgrade for India.