Does Davos Still Matter in a Fractured World?

January 2026 in Davos brought together global leaders facing perhaps the most fractured international landscape since the forum's inception. With US-China tensions, ongoing conflicts in Eastern Europe, and rising protectionism worldwide, the World Economic Forum finds itself grappling with a fundamental question: Can a Western-born institution still claim relevance in an increasingly multipolar world?

The answer isn't straightforward, and the evidence points in multiple directions.

The Changing Geography of Power

This year's WEF agenda tells a story of global economic realignment. Sessions on EU-Latin America trade deals, US policy toward Venezuelan oil, India's diplomatic balancing act, and Africa's quest for economic autonomy all share a common thread: *the erosion of traditional Western hegemony*.

Consider China's notable absence from many key discussions. Since 2020, Beijing has increasingly pursued its own economic forums and initiatives—the Belt and Road Initiative, RCEP, and various bilateral arrangements—rather than working within Western-dominated multilateral frameworks. This isn't just diplomatic posturing; it represents a fundamental shift in how global economic governance operates.

India's position exemplifies this new reality. As the world's most populous nation and fastest-growing major economy, India maintains strategic relationships with both Russia and the United States, refusing to be boxed into Cold War-style alignments. This pragmatic approach reflects a broader trend among emerging economies: choosing economic partners based on national interest rather than ideological alignment.

The Davos Dilemma

The WEF's traditional strength lay in its ability to facilitate "Track II diplomacy"—informal discussions that could break deadlocks in official channels. Business leaders, politicians, and civil society representatives would gather in the Swiss Alps to hash out solutions to global challenges.

But today's challenges may be too structurally embedded for such approaches to work. When South Africa leads the G20 or African nations demand more equitable terms in international trade, they're not just seeking better deals—they're challenging the fundamental assumptions of the post-WWII economic order.

The EU-Latin America trade negotiations, for instance, represent more than a commercial agreement. They signal Europe's attempt to maintain global influence by building new partnerships as its traditional relationships with the US become more transactional and its ties with China grow more complicated.

The American Question

Perhaps nowhere is the WEF's relevance more tested than in its relationship with the United States. American policy toward Venezuela illustrates the broader challenge: while Davos discussions emphasize multilateral cooperation and sustainable development, US actions often reflect narrow strategic interests—in this case, energy security and regional influence.

This disconnect between Davos rhetoric and great power reality has become increasingly apparent. When the forum discusses "stakeholder capitalism" and "shared prosperity," these concepts often clash with the zero-sum thinking that increasingly dominates international relations.

New Economic Blocs, Old Institutions

The global economy is reorganizing into distinct blocs: the USMCA in North America, the European single market, Asia's RCEP, and Africa's emerging AfCFTA. Each represents a different model of economic integration, and none necessarily requires WEF-style global coordination to function effectively.

This fragmentation poses an existential challenge for institutions built on the assumption of increasing global integration. The WEF may need to evolve from a forum for global governance to a platform for inter-bloc dialogue—a more modest but potentially more realistic role.

Beyond the Elite Bubble

Critics have long argued that Davos represents an elite bubble disconnected from ordinary people's concerns. Recent global events—from Brexit to the rise of populist movements—suggest this criticism has merit. The forum's emphasis on globalization and technological progress often ignores the distributional consequences that fuel political backlash.

Yet dismissing the WEF entirely may be premature. In an era of increasing nationalism and fragmentation, maintaining channels for dialogue between different economic blocs becomes more important, not less. The question is whether the forum can adapt its format and focus to remain relevant.