Opinion Tectonic shifts
The Toronto G20 was much less dramatic than the London one last year.
The Toronto G20 was much less dramatic than the London one last year. The world no longer faced a great peril and went back to its own divided ways. The Prime Minister did his best to patch up economic differences among the rich countries as to whether to continue reflating or start cutting. But that apart,the G20 is threatening to look as ineffective as the G8 has already become.
This is not in my view too hasty a judgment. Before the G20 process gets routinised,one must ask what use it is. In November 2008,faced with the financial meltdown,French President Nicolas Sarkozy was able to persuade George Bush to expand the G8 to G20 which until then was only a finance ministers forum. In April 2009,former British prime minister Gordon Brown was able to harness President Obama’s charisma to bind everyone in a common purpose of rescuing the world economy. It was a triumph of global diplomacy.
That was the perhaps the climax not the beginning. In Copenhagen in December 2009,the world looked coolly at the biggest threat to its survival and decided to do nothing. While the EU countries were seized with the urgency of global warming and small nations like the Maldives will be the immediate losers,there was no consensus as to what to do,and who was going to do what,even if they knew what to do.
The reason for this disarray is something we have known for some years but for which we have no solution. The 1945 settlement which gave us the UN and the Bretton Woods system is no longer working. The UN was an uneasy compromise between a gathering of sovereign nations which were juridically equal (General Assembly)and the old fashioned Concert of Great Powers (Security Council). While the General Assembly has expanded in size,it has become less effective in representing the people’s wishes. This is partly because sovereign states have often been found abusing the human rights of their own citizens (Zimbabwe,North Korea) and also because sovereignty is often seen a license to oppress which only outside intervention violating the UN Charter alone can end (Tanzanias intervention against Idi Amin,Indias intervention in East Pakistan).
The UN also resists reforms since no one wishes to acknowledge that all nations are not equal. The G7 was invented as an alternative to the Security Council to keep the USSR out and after Russia got into G8 to keep China out. So the SC 5 became G7 and then G8. But with globalisation of the 1990s proceeding apace and Asian countries growing swiftly,even the G8 was inadequate. Realities of economic and political power dictate a revision of SC and if the SC cannot be reformed then the G8 had to be.
This expansion of the G8 to G20 was also prompted by the unique contribution of Goldman Sachs when it invented the acronym BRIC (Brazil,Russia,India and China). It became a potent sign of the shifting tectonic plates in the world system. The problem,however,is not the viability of the newcomers but the persistence of the old laggards at the top table. In creating G7,Germany and Japan were added with some justification but Italy and Canada were undeserving. If only BRIC had been added to SC5,we would have had only Brazil and India. But with BRIC added to G8 many more countries entered the scene. The G20 has become in Churchills famous words a pudding with no theme.
In 2011,the so-called emerging economies will surpass OECD in terms of share of the world GDP. The days of the North looking down on the South are over. As the British Foreign Secretary William Hague said last Thursday,Britain has to shift its attention to India,China and Brazil and away from its traditional concerns. The EU will be for the two decades or more what Napoleon called China two hundred years ago a sleeping giant. The dynamism of the global economy will be in Asia and the Pacific region and away from the Atlantic basin. Europes days are over.
Until the world comes to terms with that reality we will go on having useless summits of the G8,G20 UN etc.
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