Frozen perhaps, but not dead: the WEF leaves open the possibility of serving as a bridge between Russia and Ukraine once the active conflict is over.

The 800-pound gorilla of the elite world conference circuit has walked a tightrope for decades when it comes to Russia: basking in the attention of the Kremlin while cowering on the antics of the oligarchs.

The founder of the Forum, Klaus Schwab, prides himself on opening his annual meeting in Davos to everyone, including through a personal relationship with Putin dating from the early 1990s.

Putin and his predecessor in the presidency, Dmitry Medvedev, addressed the WEF five times since 2007 to 2021. Putin was even invited to speak in January 2015in the aftermath of Russia’s invasion of Crimea, but he declined the invitation.

Introducing Putin at a virtual Davos rally in January 2021, Schwab called Putin’s voice ‘essential’ in global affairs, echoing 2009 commentary that he could not think of a single problem of global importance that could be solved without Russian involvement. The pair last met in mid-2021when Schwab told Putin of the “particular importance” he attaches to Russian representatives participating in the Davos events.

Schwab, through a spokesperson, chose not to comment directly on his relationship with Putin.

But the tide has turned. Not only is the aspiration to Putin suddenly downgraded, but the WEF is now forced to comply with US, European and Swiss sanctions against Russia, which means not only cutting ties with Russian banks and oil companies, but juggling with the sensitivities of SWIFT, based in Belgium. international financial transfer company (a six-figure “partner” of the WEF), whose Russian entities are now prohibited.

SWIFT did not immediately respond to a request for comment.

The dancing bears

Even before Putin’s presidency, Davos loomed large in the minds of Russian elites. An invitation to the WEF was the ultimate seal of global legitimacy for post-Soviet business leaders – and a chance to shed their clout and their euros.

The feat of Gennady Zyuganov, the leader of the Russian Communist Party, at the 1996 WEF annual meeting prompted Russian business leaders, including Mikhail Khodorkovsky and Boris Berezovsky, to form the “Davos Pact” — a plan to finance Boris Yeltsin’s presidential campaign, then a single-digit vote, to prevent the Communists from returning to power.

Throughout the 90s, The Russians celebrated in Davos, and the Russian delegation flew away. By the time Putin and Medvedev started talking on stage, it was common to find a dozen or more billionaire oligarchs in Davos.

Whether we miss them is an open question, but the absence of Russians from Europe’s highest city will certainly be noticed.

Oligarch parties in Davos were legendary and notorious.

In 2008, Olympic champion figure skaters performed under fireworks. In 2016, mining magnate Oleg Deripaska imported costumed Cossack dancers to perform for his guests, while models dressed as flight attendants visited a chalet with huge bowls of black caviar: served by the spoonful to guests via a spatula, followed by vodka chasers.

Guests at Deripaska’s parties ranged from American CEOs to members of the British House of Lords. Crowds of young women without accreditation badges from Davos – the city’s universal status system at WEF meetings – mixed in with the crowd, pretending to be translators.

In 2018, Deripaska’s party drew the ire of locals and its parties moved from residential areas to public places. He replied with give a concert by Enrique Iglesias.

Between night parties, the focal point of Russian activities was House Russia — an initiative of the Roscongress Foundation — which has taken center stage on the Davos Promenade.

More than 2,000 participants from 85 countries took part in events on the site in 2020, including billionaire hedge fund manager Ray Dalio and a disgraced former UN Under-Secretary-GeneralFabrice Hochschild.

First Covid, then Kyiv

It has already been a difficult year for the WEF, with the pandemic forcing the organization through something of a crisis.

The WEF relied on its strategic partners, who pay over $640,000 to join the Forum’s most elite partnership tier. That group includes a number of Russian banks, which helped account for some 70% of its $340 million budget in 2021. But its inability to collect fees for holding in-person events, like its assembly annual in Davos, blew a $45 million hole in its budget.

With Moscow’s invasion of Ukraine, the Forum, headquartered in Switzerland, will have to pay an even larger check: the elimination of the Forum’s ties with its Russian stakeholders has been complete.

At least six Davos regulars are now subject to personal or organizational sanctions by Western governments.

Herman Gref – managing director of Sberbank, which has been sanctioned by the US, UK and Canada – is no longer listed as WEF board member.

Chrystia Freeland, Deputy Prime Minister of Canada, sits on the WEF board and led efforts to eject Russian banks from SWIFT. A spokesperson for Freeland told POLITICO: “Canada will continue to work closely with our partners to sanction President Putin and his cronies for their unprovoked and barbaric invasion of Ukraine,” adding “we encourage organizations organizations to do all they can to support these efforts.

Lucrative strategic partnerships with Russian banks such as Sberbank, which became a WEF partner in 2008 and was a founding partner of the World Economic Forum’s Center for Cybersecurity, are on hold, WEF confirmed.

In the field of energy, the WEF’s partnerships with the conglomerate USM Holdings led by Alisher Usmanov — owner sanctioned of Dilbar, the largest yacht in the world – and LUKOIL are pending.

Neither USM nor LUKOIL responded to POLITICO’s request for comment.

According to an internal document obtained by POLITICO, sanctioned Russian CEOs registered to attend the 2022 WEF annual meeting in Davos – and who will now be banned – include Kirill Dmitriev (Russian Direct Investment Fund), Sergei Ivanov (former Putin’s chief of staff, now at Alrosa) and Alexei Yakovitsky (from sanctioned bank VTB Capital). Other CEOs who will also be absent include Alexander Dyukov (Gazprom Neft), Ivan Streshinsky (USM investments), Aleksandr Shevelev (PAO Severstal) and Grigory Fedorishin (Novolipetsk Steel-NLMK).

Leonid Mikhelson, founder and chairman of natural gas producer Novatek and Russia’s richest man as of 2016, was also due to attend. Mikhelson has so far escaped sanctions but lost over $10 billion during the first week of the Russian invasion of Ukraine. Rustam Minnikhanov, president of Russia’s Tatarstan region, was the most prominent political figure to respond.

A Moscow branch of the Center for the Fourth Industrial Revolution of the WEF, launched with fanfare in October 2021, recently disappeared on the WEF website. Hosted by ANO digital economythe center focused on emerging technologies in the areas of artificial intelligence and the internet of things, and operated through an agreement negotiated with the Kremlin and signed by Deputy Prime Minister Dmitry Chernyshenko.

The World Economic Forum’s Global Future Council on Russia is also eliminated. The Council was co-chaired by Maxim Oreshkina former economic development minister of Russia, now an adviser to Putin, and Igor Shuvalov, a former Russian cabinet member who is now chairman of VEB.RF, the country’s financial development institution, and the subject of both UK sanctions and US sanctions.

Morality against rubles

This is not the first time the WEF has faced headwinds over its relationship with Russia.

When Congress authorized sweeping sanctions against Russia, in response to Moscow’s interference in the 2016 US elections and the annexation of Crimea, the WEF sought to restrict oligarchs’ access to its Davos conference. in 2019. Under pressure from the Kremlinthis access was restored in time for the WEF Winter Gathering.

The thanks Schwab received: a no-show from Putin.

Andrey Kostin, Chairman and Chairman of VTB Bank, and one of the sanctioned oligarchs which the WEF initially shunned, slammed the rally for a “the absence of a meaningful discussion and the prominent list of no-shows.”

This time, the legal and moral pressure on the WEF has become too strong. Post-Soviet Russia and the World Economic Forum stood together: each desperately wanted to be seen as a great power.

The deal was relatively simple at first: Putin endorsed the WEF, the oligarchs funded it, and, in turn, the Forum helped whitewash their reputation. Call it multi-partnership, call it a transaction, call it the ugly truth of globalization. Like Klaus Schwab and Vladimir Putin, it was once the future. Now their only hope is peace.

Schwab and WEF President Børge Brende said in a February 27 statement that they “deeply condemn Russia’s aggression against Ukraine, attacks and atrocities. Our full solidarity goes out to the Ukrainian people and to all those innocently suffering from this totally unacceptable war.

The couple then vowed to support all diplomatic efforts related to ending the war, while expressing hope that “reason will prevail and the space for bridge building and reconciliation will once again emerge”.

Andy Blatchford contributed to this report.