Davos: Wealth, power and a sprinkling of stardust

From a suitably Olympian height, the world's rich and powerful are descending on the Swiss ski resort of Davos by private jet, helicopter and limousine to right the world's wrongs, network, take in a little practice time on the slopes, and cut a deal or two.

At 5,000 feet above sea level, the thin air will be thick with gossip, speculation and, this year, talk of recession. Once, our now moribund political parties used to gather at dismal British seaside resorts for their conferences. There, away from the party committee rooms, the council chambers and Westminster, they would indulge in lively debate, varying amounts of intellectual stimulation and a good deal of drinking. Now the World Economic Forum at Davos performs the same function for the big beasts of global business and politics; a few days out in a nice little corner of the Alps where socialising, thinking and sleeping battle for the participant's time.

For a few days an obscene proportion of the world's wealth and clout will be concentrated in one normally obscure Alpine town. Some 27 heads of state or government; 113 cabinet ministers; hundreds of chief executives, bankers, sovereign wealth fund managers, economists and the media: about 2,500 participants in all. This concentrated, eclectic mix of the top slice of humanity is part of the "magic" of this mountain redoubt. Where else, so the legend goes, might Gordon Brown find himself chatting over a cocktail with Sergey Brin? Or would we see Lakshmi Mittal sharing a plate of canapés with Ban Ki-moon? Or Carlos Ghosn chewing the fat with Mohamed ElBaradei?

With everyone from Bill Gates and Bono to Rupert Murdoch and Condoleezza Rice and the scores of lesser personalities expected in, it is no wonder the place will be surrounded by barbed wire and intense security. If you've ever wanted to know what the Swiss army is for (apart from inventing handy little multi-tools), an attempt to penetrate the perimeter of Davos will tell you, as 5,000 troops do their bit to protect international capitalism from its enemies. The Swiss air force, such as it is, also does its bit to patrol the skies. Right now there is probably no more tempting a target for the ambitious terrorist.

The WEF gets under way this week, and the formal title of the week's proceedings, as ever, gives little away about the true agenda. "The Power of Collaborative Innovation", while suggestive of the business elite's obsessions with the pace of technological change, is unlikely to be a phrase that will drop easily from many lips during the hundreds of breakfasts, lunches, dinners, plenary sessions, "workshops", parties and "nightcap" sessions that will exhaust even this most energetic cohort of gifted individuals until they return to the bosoms of their families – real and corporate – on Sunday.

So who's coming and what will they be chattering about? Well, apart from the luminaries already mentioned, the official co-chairs of the Forum are mostly well-known names: Tony Blair, of JP Morgan; James Dimon, chairman and CEO of JP Morgan; KV Kamath, MD and CEO of India's ICICI Bank; Henry Kissinger, chairman of Kissinger Associates; Indra K Noovi, chairman and CEO of PepsiCo;, David J O'Reilly, chairman and CEO of Chevron Corporation; and Wang Jianzhou, CEO of China Mobile Communications Corporation.

The prominent role allotted to Mr Wang, while not entirely novel, is nonetheless significant. This year at Davos there will be fewer figures from Hollywood, and rather more representing the new forces in the global economy – the new transnationals based in China, India, other rapidly growing emerging economies and the sovereign wealth funds that those nations and the petro-states of the Gulf now command. The shift in the balance of world economic power eastwards will be apparent in the faces and accents around the seminars, chalets and hotel bars. Not since 9/11 has the Forum met in such a sombre mood.

The prospects for the BRICs (Brazil, Russia, India, China and their smaller satellite economies) have been one of the staples of international gatherings for years, but now the ruminations have a little more point to them. In 2008, for the first time, China will contribute more to the growth of the world economy than the United States. Double-digit growth in China should still just be possible this year, and it alone seems to stand between the world and a full-blown recession.

Sovereign wealth funds (SWFs) from China and elsewhere have already been busy re-capitalising the West's stricken banks, often with a disregard for their own interests that borders on the philanthropic. The recycling of trillions of dollars of trade surpluses and petro dollars means that such deals will become more prevalent. Davos will provide one more opportunity for distressed American investment bankers to bump into munificent Singaporean or Qatari or Chinese SWF managers.

There will also be plenty of time and space for the likes of Al Gore and the green lobby to weld their hopes and fears for the planet with the more immediate, but connected, economic agenda of soaring food and oil prices, imminent water shortages and the conundrum of nuclear power.

So too will business leaders be able to get a first-hand take on the biggest single source of geopolitical instability in the world and, thus, the biggest threat to economic stability: the Middle East and central Asia. Condi Rice's keynote message will likely concentrate on this, and with the presence of Tony Blair, the representative of the "Quartet" in the region, Afghanistan's Hamid Karzai and Israel's Shimon Peres, we might expect some sort of initiative to come out of Davos. The conference has in the past been the scene of groundbreaking moves in the history of that region, and in the process of peaceful change in South Africa and eastern Europe after the fall of Communism. The WEF's slogan – "Committed to Improving the State of the World" – is a reasonably sincere reflection of what can come out of this huge talking shop.

So while we will miss Sharon Stone's impromptu charity auctions, Brad Pitt's unique contributions to economic thought and Richard Gere's perspective on global economic imbalances, the useful purposes of Davos will be immeasurably improved by the presence of serious movers from the emerging economies.

Apart from Bono, this year's stardust quotient will be provided by Emma Thompson, the cellist Yo-Yo Ma, and the writer Paulo Coelho; more of a pleasant interlude than a threat to overshadow the whole event in meaningless celebrity hype.

This is as it should be. The event has been growing in importance and prominence since its pioneering days in the early 1970s. In 1971 a German-born Swiss economist named Klaus Schwab hit upon the idea of an eclectic, informal, low-key, almost secretive gathering of the world's most influential figures and founded a not-for-profit foundation to achieve his ends.

In those days it had much in common with the Bilderberg group, but today the WEF has left its modest beginnings way behind and actively seeks out the attention of the world, whether it is to launch a campaign against World Poverty (as Gordon Brown and Bono did in 2005) or to balance the needs and aspirations of the old economies of the West, the emerging economies of the east and the still poor billions in the south.

More than anything, the WEF can push some unwelcome and unpalatable home truths under the noses of the bankers and business execs. It can stimulate the conscience as well as the imagination. It can even perhaps offer intimations of human frailty. A few scrapes on theski slopes might even convince some that they are far from invincible. A broken leg or a dislocated shoulder can do wonders for humility.

Sir Arthur Conan Doyle,the creator of Sherlock Holmes, "discovered" the delights ofskiing in Davos more than a century ago, and through Holmes even offered a little homily on its benefits. As the great detective remarked, "on any man suffering from too much dignity, a course of skis would have a fine moral effect".

Who's on-piste

Tony Blair Our former prime minister,Middle East envoy and now part time adviser to JP Morgan will be back where he likes to be: at the centre of attention. Davos is atraditional place for old business and political acquaintanceship to be rekindled, so maybe a chat over a drink with Gordon Brown might thaw their notoriously frosty relations.

Hank Paulson The US Treasury Secretary, and former Goldman Sachs chief, is bound to receive a careful hearing as the US economy moves steadily towards recession. Will President George Bush's latest proposal to boost the American economy work?

Bader al Sa'ad Former college basketball player and investment banker, who is now responsible for the Kuwaiti Investment Authority. One of the older of the now burgeoning breed of sovereign wealth funds. He has $3 trillion to play with; how many Western bankers will be looking to him to help them out of a sticky situation?

Mukesh Ambani Typical emerging markets big beast. Chairman and chief executive of Reliance Industries of India, the mining and energy conglomerate. Personally worth $45bn, making him the sixth richest person in the world. Who wouldn't want to share some fondue with him?

Where to be seen this year

Hotel Steigenberger Belvedere Where the bigwigs stay and scene of some of the best parties. Compared with this five-star establishment, little of importance goes on anywhere else in Davos, and some banks hire entire floors. This year, it's the site of Google's party, with Sergei Brin, Larry Page and assorted world leaders looking at the future of technology and sampling vintage wines while being entertained by the DJ and Kiss FM founder Norman Jay. Delegates can commiserate with Sir Wim Bischoff on Citigroup's $10bn losses there on Friday night; while earlier in the week Arcelor Mittal plans a late-night "speakeasy" at the hotel.

McDonald's The golden arches can be found, incongruously perhaps, even in this remote corner of the world. Just as well, as it is Bill Gates' favoured eaterie. For some, at the very top of the world, food is mere fuel, and the faster it is prepared and downed the better. Mr Gates sends out for his meals.

Bill Gates session Talking of whom, perhaps the business highlight of the week will be Mr Gates' session on the structural problems facing modern capitalism. He will be following a series of "brainstorming" sessions tomorrow where hundreds of chief executives will gather to debate and vote on fundamental challenges facing the world economy.

Hotel Schatzalp This former sanatorium was a pioneering site for research into TB and the setting for Thomas Mann's The Magic Mountain. It possesses a certain jaded Art Nouveau era beauty, and is perched precariously above the town on the Parsenn mountain. Famous for its hot chocolate these days, and the Barclays' dinner.

YouTube Way outside the hall, indeed covering the world, is the World Economic Forum's "Big Question": YouTube users are being asked, "What single thing can global leaders do to improve the world?"

Hotel Europe Nightcaps are very popular, which makes the pace of Davos even more difficult to sustain. Try the piano bar of this Davos Platz institution, where Barry the cabaret singer will belt out Manilow and Queen covers. It's said that Barry has met more global leaders than Elizabeth II.