Millennium Post

Growing irrelevance of G-8

The growing irrelevance of G-8 in a world so vastly different from the ‘cold war’ days of mid-1970s – when it was launched, on France’s initiative, as a group of leading economic powers to co-ordinate essentially global economic policies – was in ample evidence at its latest Summit in Northern Ireland (17-18 June).

Not only that Syria, heavily backed with arms by Russia, proved a tough challenge for the Western nations which had to toe the Moscow line of political solution reconciling themselves with Bashar al-Assad’s continuing despotism in the two-year civil war, which UN said had claimed over 93,000 lives. There was no reference to him in the G8 Declaration.

Indeed, Syria issue put Russia’s President Putin on one side vis-à-vis the other Seven and in direct confrontation with USA, bringing to mind a vestige of the cold war. For President Obama, who had wanted Assad to step out of power as price for the carnage he had inflicted on his countrymen and make way for a democratic transition, the Summit produced an uneasy compromise.

The Syrian crisis not only brought to fore the limits of the out-reach of the world’s sole super-power but also exposed the infirmity of an institution (G-8), now in its fourth decade, in providing effective leadership to the international community in tackling the challenges of the 21st century. The ‘rest of the world’ now compromise several fast-growing economies, emerging and developing, which outpace growth in advanced nations even as the latter struggle to overcome the damage inflicted by the global financial crisis which erupted five years ago. China, now the world’s second largest economic power, along with India and several other Asian and Latin American countries have been on a dynamic growth path.

The international community is called upon to restructure the world economic order and global institutions to reflect the growing economic weight of emerging and other developing countries. They now account for nearly 50 per cent of global output and have a substantial share in world trade. Increasingly, they will play a dominant role as USA and European powers will be on a long haul to reduce their huge fiscal deficits and debts and bring down high levels of unemployment.

In a sense, the advanced nations became victims of their own free market philosophies which they promoted in emerging nations like India while China embraced it within limits. The changing world economic scene is better reflected in the wider G-20 major economies, advanced and developing economies, and has been designed as the principal instrument for decision-making at the global level on economic and social issues.

In this setting, the G-8 in which a globally-weakened Russia, but still a nuclear-superpower, was a late entrant, is hardly seen to have any commanding voice in world affairs. It could have even become obsolescent, and largely serves to keep alive the North Atlantic alliance of America and Western Europe which President Obama described as ‘the cornerstone of our freedom and our security’. But even here, western nations have serious differences – notably the EU-US approaches to tackling economic crisis for sustainable growth.

That the Atlantic Alliance broadly holds them together was sought to be demonstrated before the start of the G-8 Summit in Enniskillen, Northern Ireland, when the host, Prime Minister David Cameron of UK set the stage for the launch of negotiations on a Transatlantic Treaty on Trade and Investment Partnership (T-TIP). President Obama said ‘this potentially groundbreaking partnership would deepen US-EU relationship, which already makes up nearly half of global GDP with trade at about one trillion in goods and services.

Talks on the Treaty would start in Washington in July and the plans are to conclude it by the end of 2014 though many sensitivities have to be dealt with while reducing barriers to trade and investment. The President said the proposed Treaty had been warmly received in the United States, both in the Congress and in business community, and was pleased it has the backing of the entire EU
membership (27 nations).

Syria was the most intractable issue at the two-day G-8 deliberations, and Russia has from the beginning backed Damascus with regular supply of arms and stoutly resisted any idea of Bashar al-Assad quitting the scene, as strongly urged by the US Administration, for bringing about a political solution to the civil war of catastrophic proportions.

A sense of frustration was creeping even among European allies, like France and Germany, over the prolongation of the Syrian conflict and a missing leadership by the US President. Meanwhile, the tide had been turning in Assad’s favour with not only Russian reinforcements but also support by fighters of Hezbollah. Putin was also not quite convinced about the use of chemical weapons in Syria, a US determination regarded as the red line for the President’s decision to send small arms to the opposition fighters.

No wonder the Obama-Putin meeting at the start of the summit failed to produce a meeting ground and the two leaders spoke candidly of their ‘differing perceptions’. Putin, however, said that despite conflicting opinions, they intended to make efforts to stop ongoing violence and solve the situation peacefully ‘We agreed to push the parties to the negotiations table.’ Obama, in turn, concurred and said they also agreed also on securing chemical weapons through UN and ensuring that these were not used or allowed to proliferate while trying to resolve the issue through political means, ‘if possible’. The G-8 communique hammered out after tough talks among leaders simply called for an end to the bloodshed and peace talks as soon as possible.  ‘We remain committed to achieving a political solution to the crisis based on a vision for a united, inclusive and democratic Syria’, it said.
President Obama, who won re-election with the widest popular acclaim, has had to face at this early stage of his second term even greater challenges than before, and irrespective of any limited successes he might make as he navigates his way through the shoals, the halo around him abroad has faded to some extent, and Syria, where failure is writ large in the way he has handled it, may become a millstone around his neck.

On world economy, the G-8 leaders reaffirmed commitment to promote growth and create jobs, particularly for youth and build a fiscally prudent strategy for long-term growth. They also endorsed a framework of principles drawn up by OECD to combat international tax evasion and ensure each nation secured additional revenues. An action plan is expected to emerge from the July meeting of G-20 finance ministers. IPA

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