Axios World: Ukraine dominates Davos

Plus: China's Pacific islands play | Thursday, May 26, 2022

Open in app View in browser   Presented By Kroger   Axios World By Dave Lawler · May 26, 2022 Welcome back to Axios World. This edition (1,714 words, 6 1⁄2 minutes) is coming to you on a brisk but beautiful evening in the Alps. We're off on Monday for Memorial Day, but my colleagues and I are pulling together a Davos special report for Saturday, so watch out for that. New arrival? Subscribe.     1 big thing: Ukraine dominates Davos agenda Volodymyr Zelensky addresses the World Economic Forum. Photo: Fabrice Coffrini/AFP via Getty   DAVOS, Switzerland — Ukraine dominated the official and unofficial agendas at Davos, and it will likely continue to do so at upcoming global gatherings — G7, G20, UN General Assembly. Yes, but: Some Davos participants, particularly from non-Western countries, worry that the war is not only exacerbating other global challenges, but taking attention away from them. On the one hand: Ukrainian Foreign Minister Dmytro Kuleba told Davos attendees Wednesday that Ukrainian soldiers were taking heavy losses in the Donbas because they lacked the weaponry to fight from a distance. The message was clear: Western dithering was costing Ukrainian lives. On the other: Samir Sahan, head of the Observer Research Foundation, a think tank based in Delhi, told Axios it felt like it was hard to hold a conversation in Davos about any issue other than Ukraine. While that's understandable, he said, Sahan worries climate and development priorities — and crises outside of Europe more generally — are being pushed off the international agenda. Referring to the amount speedily appropriated by Congress last week to arm Ukraine, Sahan added, "I would like to see $40 billion for climate projects in the developing world, for example. But it would be difficult to get anywhere close to that." Another view: Natalie Jaresko, a former Ukrainian finance minister, told Axios the most effective way to stem other global crises — hunger, energy, recession — was to help Ukraine win the war. "Only step by step are we starting to recognize the global effect of [Putin's] war," said Jaresko, part of a dozens-strong Ukrainian contingent in Davos to rally support. "Today it's food, tomorrow it will be steel, and by the next meeting, it'll be something else." The knock-on effects of the invasion are certainly being felt. In one panel discussion, Bangladeshi State Minister for Foreign Affairs Shahriar Alam said the war was already unleashing grain shortages and political instability in South Asia. But while his U.S. and Ukrainian co-panelists appealed for arms and sanctions to help Ukraine win, Alam laid out a different priority: "We want the war to end. Right away." Sahan also argues that NATO countries should be focusing more on bringing the war to an end than imposing costs on Russia. As Harvard political scientist Graham Allison told Axios, "Most of the world does not agree with this 'West is back' conception of what is happening in Ukraine." What to watch: Sahan says the resurgence of belief in the liberal international order amid the Ukraine crisis does offer hope — if, that is, the momentum carries over onto challenges beyond security in Europe.     2. The view from Davos: Where the economy is heading The Congress Centre in Davos. Photo: Fabrice Coffrini/AFP via Getty   Since Davos is an economic forum, I spent a good chunk of my week listening and speaking to business leaders. Here are three things that stuck with me: 1. "Recession" worries are back. Ryan Petersen, CEO of shipping logistics company Flexport, shares perspective from his industry: At the height of the pandemic, people who couldn't spend their money traveling or going out to eat started buying more stuff online. There wasn't enough space on ships to transport it all, causing shortages. As that happened, desperate companies were placing multiple orders for hard-to-get products and parts — sending very strong demand signals up the supply chain. Companies invested in production capacity to catch up. What's next: Peterson thinks we're now entering a new stage in the cycle, where demand falls and orders slow, leaving a glut of goods. "That's called a recession," he says. 2. Hybrid work and flexible hours (including four-day workweeks) are here to stay, at least for employees whose duties allow it. Jonas Prising, CEO of staffing firm ManpowerGroup, tells Axios that's what high-skill job seekers now expect. Yes, but: He doesn't expect a big surge in remote workers moving to new cities. "People want to stay close to their friends, they want to stay close to their family," and since many households rely on two incomes, they don't want to jeopardize either by moving, Prising said. Then there are the roughly 60% of workers in the U.S. and Europe whose jobs require them to be in-person and on-shift — including during the pandemic. They've realized how essential they are, and they want to be compensated accordingly, Prising says. In the EU, most remained on company payrolls during the pandemic and returned to work once able. But in the U.S., many switched industries or left the workforce (often due to the lack of affordable child care). That helps explain the shortage of service industry workers. 3. Walking around Davos, cryptocurrency companies were everywhere outside of the official forum, renting out billboards and bars on the Promenade. But they hardly featured on the official agenda, Axios' Felix Salmon points out. That's a Davos-sized metaphor for an industry trying to gain acceptance from the incumbents.     3. U.S.-China news roundup Antony Blinken speaks about U.S. policy toward China at George Washington University on May 26. Photo: Jim Watson/AFP via Getty Images   1. Secretary of State Antony Blinken warned in a speech today that despite the current focus on Russia and the war in Ukraine, China poses the "most serious, long-term challenge" to the international order, Axios' Ivana Saric writes. 2. U.S. and Japanese forces held a joint fighter jet exercise over the Sea of Japan, Tokyo announced Thursday. The flights took place a day after China and Russia sent military jets near Japanese airspace while President Biden was visiting Tokyo. 3. China is seeking a regional security pact with 10 Pacific island countries, according to a draft communique seen by Reuters. The news comes after a deal was struck between Beijing and the Solomon Islands that alarmed the Biden administration. The latest: Micronesia has rejected the deal and urged its fellow island states to do the same. 4. In a string of recent indictments, the U.S. Department of Justice is cracking down on Chinese state-backed repression of U.S.-based dissidents, Axios' Bethany Allen-Ebrahimian writes. Go deeper. 5. South Korean special envoy Na Kyung-won told Axios at Davos that the "biggest difference" in Seoul's foreign policy under new President Yoon Suk-yeol will be its "values-based" (read: harder line) approach to China.     A message from Kroger Life at Kroger: people matter     At Kroger, we take seriously our role as one of America's largest employers. Since 2018, we've invested more than $4.5 billion in wage increases, training, pensions, and health care benefits for our associates. Learn more about the opportunities made possible by the Kroger Family of Companies.     Bonus: Where in the world? The following countries have two official languages: English and one other. Can you name the other one? Canada India Pakistan Philippines Cameroon Kenya Scroll to the bottom for the answers.     4. Swiss neutrality is evolving after Putin's invasion Illustration: Aïda Amer/Axios   While Switzerland has no intention of joining Finland and Sweden in abandoning neutrality, the forum's hosts are also re-examining the concept, Fabienne Kinzelmann, foreign affairs editor for the Swiss daily Blick and a former Axios fellow, writes from Davos. Driving the news: Swiss President Ignazio Cassis introduced the term "cooperative neutrality" while opening the forum, saying, "There is no neutral attitude towards the brutal violation of fundamental values, which are also our values." Switzerland will stand with countries that defend "the very foundations of democracy," he said. "This cooperative neutrality is still in keeping with Switzerland's understanding of neutrality." Yes, but: While Switzerland was quick to condemn Russia's invasion, the country still prohibits the supply of weapons to warring parties. That has meant blocking Germany from sending Swiss-made tank ammunition to Ukraine. And while Switzerland has adopted EU sanctions, it's been criticized for not moving to swiftly freeze Russian assets. Flashback: Micheline Calmy-Rey, one of Cassis' predecessors, advanced the form of "active neutrality" that helped build Switzerland's reputation as an international mediator. After his speech, Cassis defined cooperative neutrality as standing up for "common values," "joint peace efforts" and a "rules-based and stable security architecture." "It's also about who's going to be in charge of the post-war security discussion," he said. What's next: Switzerland will host the Ukraine Recovery Conference in July.     5. Data du jour: Authoritarianism is risky business Illustration: Aïda Amer/Axios   Just 12% of Americans think companies should be operating in Russia as normal, while nearly one-third (31%) say multinational firms should never do business in Russia again, according to new data from the annual Axios Harris Poll 100. Why it matters: Russia's war with Ukraine is forcing companies that would rather operate apolitically to take a stand. The remaining respondents mostly think companies should resume operations once Russia withdraws from Ukraine (27%) or only if there's a change in government in Moscow (30%). Major global brands like Disney, Ikea and Starbucks have suspended operations in Russia, while McDonald's is selling its restaurants and withdrawing entirely. Still, many others are hedging or staying put. Zoom out: 82% of Americans think companies should place some limitations on their operations in countries with authoritarian regimes, according to the poll. Just under half (45%) would have a worse opinion of a company if they knew it was sourcing materials from authoritarian states. Worth noting: Gen Z (35%) and millennial (28%) respondents were less likely to hold that opinion than older generations. Go deeper ... Methodology.     6. 💬 My thought bubble: How Zelensky defines victory Photo Illustration: Shoshana Gordon/Axios. Photos: Ukrainian Presidency/Handout/Anadolu Agency, Alexey Nikolsky/Sputnik/AFP via Getty Images   Ukrainian President Volodymyr Zelensky can be cagey when asked to define victory for Ukraine. But after listening to him three times at Davos, including in his interview with my colleague Jonathan Swan, I think he has actually set out a pretty clear view on the endgame. Here's my best attempt at cobbling together what he has laid out. The war will end in diplomacy, but diplomacy is not currently possible and Russia's crimes make it harder. To ever get to an acceptable deal, Ukraine will have to succeed militarily, so don't tell Kyiv to seek a ceasefire. Ukraine's ultimate goal is to restore its full territorial integrity, but trying to do that by force (particularly in Crimea) would cost hundreds of thousands of lives, and Zelensky doesn't want that. It's up to Russia to create the space for diplomacy because it's the one invading. Zelensky suggested Wednesday that if Russia pulled back to its pre-invasion lines, real diplomacy could begin. Up to and until such a breakthrough, Ukraine needs more arms and support to fight as long as it takes. Go deeper: Two Russian soldiers plead guilty in war crimes trial Russia default likely after U.S. Treasury move In photos: Ukraine after 90 days of Russian attacks     7. Stories we're watching A lion on the prowl in Hwange National Park, Zimbabwe. Photo: Zinyange Auntony/AFP via Getty   Texas shooting coverage: Remembering the victims; Leading cause of death for American kids; Painful memories for El Paso Biden officials on secret Saudi trip U.S. wrong to exit Iran deal, Israeli official says "Senior leadership" responsible for Boris Johnson lockdown parties Sweden recommends 5th shot for people at risk of severe COVID WHO chief re-elected Monkeypox is not another COVID Quoted: "We don't have to worry about the fucking monkeypox, do we?" — Al Gore in conversation at Davos, overheard by your correspondent.     A message from Kroger Investing in our associates     At Kroger, our priority is to invest in our associates. Our average hourly compensation is over $22 when factoring in generous benefits like affordable health care, 401(k) plans and pensions. Learn more about the opportunities made possible by the Kroger Family of Companies.   Answers: 1. French; 2. Hindi; 3. Urdu; 4. Filipino/Tagalog; 5. French; 6. Swahili Key: 1. Canada; 2. India; 3. Pakistan; 4. Philippines; 5. Cameroon; 6. Kenya Like this email style and format? It's called Smart Brevity®. Over 200 orgs use it — in a tool called Axios HQ — to drive productivity with clearer workplace communications.   Axios thanks our partners for supporting our newsletters. If you're interested in advertising, learn more here. Sponsorship has no influence on editorial content. Axios, 3100 Clarendon B‌lvd, Suite 1300, Arlington VA 22201   You received this email because you signed up for newsletters from Axios. Change your preferences or unsubscribe here.   Was this email forwarded to you? Sign up now to get Axios in your inbox.   Follow Axios on social media: