HIGHLIGHTS: Børge Brende

0:01Hi, everybody. Tune in to this short version of the podcast, which we do every Friday. For the long version, tune in on Wednesdays. Hi everyone, I'm Nikolaj Tangen, the CEO of the Norwegian Sovereign Wealth Fund And today I'm really excited because I'm joined by my fellow Norwegian, Børge Brende And Børge, he is the President and CEO of the World Economic Forum The organization behind the iconic Davos gatherings And that's where the world's most powerful leaders meet each year To shape the global agenda Børge also happens to be, I think, the best connected person in the world So Børge, pleasure to have you here Oh, coming from you, that means a lot.

0:40Börger, before we move on to the really big topics, for listeners who don't know, what exactly is the World Economic Forum? So the World Economic Forum is 55 years old. It is an international organization for public-private cooperation. It's based here in Geneva, Switzerland. It's not-for-profit. And as you said, we're most known for our annual meeting in Davos. that brings key people from business and governments together. But we have hundreds of meetings. We have hundreds of different initiatives, public-private, in the field of fighting corruption to nature and climate, to reviving growth and trade.

1:26How many people work at the Forum? How big an organization is it? All together, around 1 ,000 people. Wow. How do you define success? for the organization? What is it that you want to achieve? It is when we can get people together and we can facilitate progress. And what's the key to that? So, of course, in today's world where we see much more fragmentations and polarization, it's harder than in the past to get people that don't even agree in the same room. But even in the age of nationalism and nation states, there is also overlap in interest. So what we're trying to identify between companies and countries, if there is overlap in interest, we can strike and we can maybe form an initiative.

2:23We can facilitate the progress that I was referring to. So, for example, look at cyber crime. We probably lose like four or five trillion US dollars a year in cybercrime. That's like three, four percent of the global GDP. I think even the G2, China and the US can agree that is not a good idea. So there we can work on rules and regulations on how to get rid of this criminal use of cyber. I think there are also other areas like future pandemics. Hopefully, in the future, we can come back again to have some more consensus on nature and climate. So these are areas, and this is our kind of modus operandi today.

3:11How far do you think this geopolitical fragmentation will go? It's hard to say, but, you know, world leaders also want to revive growth. To be reelected, you need a good economy. And I think they will also see that if you go too far in near-shoring, friend-shoring, and only trade with people you like and not where you get the best and cheapest products, part of your input factor, will also come with economic costs and you will see more sluggish growth. So hopefully there will not be a full decoupling. I think there is going to be a securing of the global value chains, but I don't think there will be a full decoupling.

4:07Do you think we'll see a period of economic stagnation? I think there are elements that are now slowing down the global growth. And I think the fact that we have the highest global debt since 1945 also gives nation states a harder time if we're going to see a recession. There is not that much of fiscal muscles. But at the same time, I don't think we're going to see a repetition of the sluggish growth from the 1970s. And why is that? I think, as I already mentioned, the new technologies are so incredibly powerful. and the way that trade was the engine of growth for decades grew two to three times more than trend growth.

4:56I think the new technologies will be the big game changer. They will increase productivity maybe with 10 % in the coming decade and they can then be the factors that will still continue with growth even if there is more decoupling in the global economy. And the global economy has been surprisingly resilient so far, even in a very difficult geopolitical situation. So I'm more half glass full than half glass empty. I need to ask some slightly difficult questions, too. So lots of private jets at Davos, you know, kind of a pretty big contrast to the climate focus you have. Just how do you look at these things?

5:48So it is true that a lot of also governmental leaders do come with their presidential or official planes. You know, when we have had Trump twice in Davos, he does land with Air Force One. Well, he's got a new plane now. Yeah, yeah, I saw that. But it still would be counted. And it's also true that some of the big CEOs of the world that run companies that have a bigger turnover than many countries, they also come with their official plans. I think that is de facto a reality and it's not going to change with Davos. So I'm just registering this and it's a fact. What is your view on the kind of U-turn or backlash we've seen against against ESG and climate initiatives?

6:58So politics maybe have changed, but science hasn't. But it is true that when you discuss climate, you also have to bring in energy. It's like a triangle. There's still like 700 million people on our planet that don't even have access to electricity. That is needed to support progress and development. and we need to decouple growth in energy and CO2 emissions in the future. But at the same time, we also have to do it in a way that we don't compromise on energy security. We have seen in Europe how bad an idea it was to base almost half of our natural gas from Russia. Diversification is also important.

7:45So I think it's not simplistic. Changing the energy demand and changing the way we also support our development with different energy sources is the most complex transition we've been through probably for decades. We briefly touched on AI a couple of times, and it's just totally revolutionary in the way that we, in many of the things we do in our company. Just how do you think it will shape the future of global business? It's already changing things very fundamentally. I thought we were going to be in the hardware phase for a bit longer, where you needed trillions of US dollars investing in the new language models.

8:46But I think that deep seek experience from China, suddenly this company that no one had heard about had then a language model that was developed for maybe one third, one quarter of what others had done, shows that we're maybe a little bit closer to the software phase where we can do applications. And with that, I think we're just going to see like a thousand flowers blossom in the energy field and AI field in the years to come. And where I'm expecting big, big changes is in medicine, the synthetic biology. There's going to be so many breakthroughs. But also, of course, there are jobs that are today done by humans, back offices and all that.

9:34that will be replaced by Gen.ai. But that is also the history that you then move higher up in the value chain. Like if you increase productivity, you can also increase prosperity. But it also creates some fear, of course, fear for jobs and fears about the future. But like look here in Switzerland, when I'm now a base, 95 % of the population worked in the agriculture sector 100 years ago And now it's like 2%, and they produce much more food than back then with 2 % of the population. And you could ask, where did all these people go? Yes, they went up in the value chain, created prosperity. That's the future.

10:19Working at the World Economic Forum. For example, for example. Not a bad place.