Blair at Davos calls for peace, climate pact

Leading figures in business, politics and the humanities closed this year's World Economic Forum Sunday with high expectations for the year ahead, chief among them an Israeli-Palestinian peace deal and a pact on climate change.

Former British Prime Minister Tony Blair said Sunday he wants agreement on both issues by the end of 2008. Sharing the same level of ambition, Nobel laureate Elie Wiesel called for China to open its doors to the Dalai Lama and for an end to the conflict in Sudan's Darfur region. PepsiCo Inc. chief Indra Nooyi urged lower food prices so the poor don't go hungry in 2008.

The final session of this year's gathering of the world's rich and powerful seemed to shrug off any pessimism about what can be achieved in the coming months despite fears that the U.S. economic downturn could lead to a global recession.

"The mood was moderately optimistic because we have many, many opportunities," the forum's founder, Klaus Schwab, said. "But if we do not address the challenges, one day even the greatest opportunities will not be enough to guarantee our continuation as humankind if you look at climate change, terrorism, poverty."

The five-day political and economic brainstorming session that brought nearly 2,500 of the world's movers and shakers to this Swiss ski resort was short on "glitz" this year — with the exception of rock star Bono and Oscar-winning actress Emma Thompson, who are both anti-poverty campaigners as well.

The real stars of Davos remain the young entrepreneurs like YouTube co-founder Chad Hurley, and perennial favorite Bill Gates who got a standing ovation in his last appearance as Microsoft chairman. He is stepping down later this year to focus more on philanthropy.

U.S. Secretary of State Condoleezza Rice defended President George W. Bush's push for democracy in the Middle East and elsewhere, and tried to calm economic fears, stressing that the U.S. economy is resilient and would remain an "engine of growth."

Whether the U.S. economy is heading toward recession — or just slowing down — and the likely impact on the rest of the world was the subject of intense discussion, with much speculation on whether Asia's two giants, China and India, would be able to absorb some of the shock.

"I am optimistic about the future," Wang Jianzhou, chairman and CEO of China Mobile Communications Corp., told Sunday's closing session. "If there is the recession in the world, generally speaking it will have an impact on China, but I don't think it will be very big."

There would be a reduction in Chinese exports, said Wang, whose company now has 370 million subscribers, "but we still have very, very strong domestic consumption."

"The decoupling has started," K.V. Kamath, managing director and CEO of India's ICICI Bank, said, "but I think the U.S. is still center stage. Maybe it has shifted slightly, but it has not gone offstage."

PepsiCo's Nooyi said "the world is really global" citing the growing economic power of China, India and many other Asian nations.

"I think this is going to be the first test where we're going to see if the engine of growth for the world is only the United States — or has the balance of power actually shifted to become even more evenly distributed around the world? So I'm quite optimistic about the situation," she said.

Oil expert Daniel Yergin, chairman of Cambridge Energy Research, said US$90-$100 a barrel oil prices have hurt economic growth — and the world might be using 50% more energy 25 years from now.

"The question is what kind of energy, how efficiently, and how cleanly," he said.

"Everything's open for business right now," Yergin said. "I've never seen so much focus on innovation all across the energy spectrum," from conventional energy to ultra deep waters and renewable sources like solar and wind power.

"Maybe 5 to 10 years from now what we'll have is a more diversified energy picture, and perhaps people will be driving a car that gets 70 miles per gallon. They may be driving electric cars, cars with batteries, or hybrids," he said.

Politically, there was much talk about whether Bush's goal of a peace treaty between Israel and the Palestinians by the end of the year will be reached.

"I would like to see an agreement that gives us the prospect of a lasting peace between Israel and Palestine because I do think that would be the greatest signal of reconciliation with which the 21st century could start," said Blair, who is now the chief envoy for the key international Mideast mediators known as the Quartet.

"The terms of an agreement are not the toughest challenge," he said.

"The absolute key to resolving this is to continue the political process" and change "the facts on the ground" to meet Israel's security concerns and give Palestinians "greater confidence that Israel will lift the burden of occupation," Blair said.

Wiesel said he also wanted to see Mideast peace this year, and "to alleviate the suffering in Darfur which has become the capital of human suffering in the world today."

"I'd like China to open its doors to the Dalai Lama so I could accompany him to go to Tibet. That would be a great, great victory," Wiesel said, as the audience burst into applause.

This year, Blair said, he'd also "like to see us get the climate change deal or framework of it."

Nooyi said she'd also like to see "a climate policy" and efforts to bring down rising food prices, which she called "unacceptable."

"We've taken years to get people out of poverty, give them a couple of meals a day when they were only eating one meal a day or less," she said. "We run the risk of slipping back to poverty if food prices are escalating much too fast."

Many participants touched on another major theme at Davos this year: How to stem terrorism.

Afghanistan's president warned that the world could suffer terribly from the "wildfire" of terrorism engulfing his region. Pakistan's President Pervez Musharraf pledged to "carry on the fight against terrorism and extremism."

Wiesel said the greatest threat to humanity today "is the globalization of fear because of terrorism" — especially suicide bombings and fanaticism.

"Somehow the future today is much more dangerous than it used to be because of people we don't know who have a cult of death ... and practice the cult of death," he said.