BitGou: Thursday Morning Briefing: Why Davos is talking about the fight between two absentees

Day 3: 2019 World Economic Forum

The two most powerful men in the world are not at the World Economic Forum this year, so why is seemingly everyone at Davos talking about the fight between presidents Trump and Xi? Well, that’s because the U.S.-China trade war has begun to weigh on global growth and hitting countries from Canada to Singapore. Executives gathered in the in the Swiss Alps this year also blame the grueling trade dispute for slowing foreign direct investment coming into the United States.

Saudi Arabia has sent one of its strongest delegations ever to the Swiss mountain resort and packed its top executives’ agendas with meetings with international peers. It has even managed to secure top Western businessmen for a panel debate on ‘Next Steps for Saudi Arabia’, where French oil major Total’s chief executive Patrick Pouyanne and Morgan Stanley’s boss James Gorman will be sitting next to the Saudi finance and economy ministers.

As the most prominent political leader this year in Davos, German Chancellor Angela Merkel delivered a robust defense of the post-war multilateral order, lauding compromise as a virtue in international relations in a veiled criticism of President Trump.

Facebook is working overtime to win back the trust of public after facing scandals for violating its users’ privacy in what has been a tumultuous year for the company. In Davos, COO Sheryl Sandberg said it is investing billions of dollars a year to improve the security of its network. “We did not anticipate all of the risks from connecting so many people,” Sandberg said, adding that the social media giant is trying to give users greater control over their personal information.

Six months since entering politics and government, Italian Prime Minister Giuseppe Conte took to the international stage in Davos to talk up his administration’s populist vision. “We are radical, but we are radical because we want to bring power back to where it was supposed to be, according to our Constitution, its people,” said Conte.

With just over nine weeks till Britain is due to leave the EU, former prime minister Tony Blair said that Britain should hold a second referendum to bring “closure” to the chaotic Brexit process, and he believed the chances of such a vote taking place were now greater than 50 percent. Speaking from Davos the Blair added, “but I think if you leave without going back to the people, with this mess and in these circumstances, there will be even greater division.”

Highlights

The U.S. President Donald Trump said in a late night tweet that he would delay a State of the Union address until the government shutdown was over. It came in response to House Speaker Nancy Pelosi’s move to block his plans for the speech. The partial shutdown has left 800,000 federal workers without pay, and Pelosi effectively disinvited Trump from delivering the annual State of the Union address in the House chamber until the government is fully opened.

Artificial Intelligence will hit hardest in the U.S. Midwestern states and among less-skilled workers. A new study by Brookings Institution researchers says the U.S. heartland states affected by job automation in recent decades, areas pivotal to Trump’s election, will be under the most pressure again as advances in AI reshape the workplace. States with more manufacturing and more low-wage, lower-skilled jobs may see more positions displaced as automation and computer-driven technology spread.

Meet Juan Guaido, the 35-year-old Venezuelan congress chief and industrial engineer, who has been catapulted overnight to national leader, after declaring himself interim president before an ebullient crowd of supporters on the streets of Caracas in hopes of change. He is part of Venezuela’s opposition seeking to maintain pressure on President Nicolas Maduro and has won support and diplomatic backing from the United States and nations across Latin America.

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6:22 AM - 24 Jan 2019

Tech in China

Breakingviews: Big Brother startups offer white knuckle returns. China’s facial-recognition technology specialists SenseTime and Megvii are in fundraising mode. Video surveillance in China is tipped to be a $20 billion industry by 2022, according to Bernstein research, up from $8 billion in 2017. Sticky questions could result in volatile valuations, but Beijing’s resolve to watch its people closely will drive growth, writes Alec Macfarlane.

New Zealand’s prime minister has assured Chinese telecoms company Huawei of even-handed treatment after the small U.S. ally blocked the sale of some Huawei equipment citing national security concerns. Huawei has always denied that Beijing has any influence over it, but last November the New Zealand intelligence agency blocked a local telecoms operator, Spark, from using Huawei equipment to build out its fifth-generation network. Top U.S. universities are also ditching telecom equipment made by Huawei and other Chinese companies to avoid losing federal funding under a new national security law backed by the Trump administration.