Will the real leaders’ summit process please stand up?
For those of us who love nothing better than a global governance nerd-out, this year is turning out to be a feast. As I noted back in April, the London Summit made a decent start on tackling the immediate term economic crisis – but also left the really big, long-term questions about global risk management (climate, economic imbalances, oil and food security and so on) for another day. But which forum is supposed to pick up the baton?
One point on which most observers of summitry increasingly agree is that it’s not the G8. Even before the G20 meeting held in DC in November last year, it was unclear how a body that excluded China, India and other emerging economies as full members could really play a serious role on issues like climate, trade or global economic governance. Now that China has bailed out the IMF to the tune of $40 billion – and started to flex its muscles on the question of the world’s reserve currency – a return to the status quo ante seems highly unlikely.
Another factor is the increasing likelihood that Italy’s shindig in July could prove the final nail in the G8’s coffin. While seasoned G8 watchers agree that ruthless prioritisation is crucial for an effective summit, Italy’s stated priorities now include “the financial and economic crisis and the search for new proposals for stability and growth”; “the battle against climate change”; “the fight against terrorism and nuclear proliferation”; “development in Africa and other less advanced economies”; and (after dinner, presumably), “regional and global security … with special attention paid to the Middle East and Afghanistan”.
But if the G8’s future looks pretty uncertain, don’t assume that means that the G20 is here to stay. Although another summit is already scheduled for Washington in September, the signals are that the US may use its position in the chair to knock the forum on the head at the leaders’ level and return it to its former role as a finance ministers’ gathering.
US policymakers were struck by the unwieldiness of the forum in London, it is said – particularly once Spain and the Netherlands had pushed successfully for inclusion in the summit, making the G20 a de facto G22. The US could therefore signal a preference for falling back to a G13 (comprised of the G8 and its +5 grouping, with the emerging economies finally included as full members), or maybe the G16 proposed by the Managing Global Insecurity project (pdf – see also my 2007 CIC paper comparing proposals for new G[x] forums).
Meanwhile, there’s also the glorious, doomed attempt by the UN General Assembly to turn itself into the cockpit of global economic governance. The current President of the GA – Miguel d’Escoto Brockman, a senior Sandinista from Nicaragua – began by commissioning a report (pdf) from a panel of experts chaired by Joseph Stiglitz, and followed this by organising a summit (the snappily titled ‘United Nations Conference on the World Financial and Economic Crisis and Its Impact on Development’) – which was to supposed to have been held next week in New York.
Just another UN talking shop, you ask? Not if d’Escoto has anything to do with it. On 8th May, he published a draft outcome document for the summit, which – bringing a whole new meaning to the term ‘big bang approach’ – set out plans for the creation of:
– a Global Stimulus Fund (which would attract funds from big surplus nations like China and Japan, and use them for purposes like balance of payment support, stimulus investments, food security or trade credit);
– Global Public Goods Authorities for Sea, Space and Cyberspace (raising new revenues from taxes, fines, permits and controls on the use of these goods);
– a Global Tax Authority (which would run international taxation on, for example, carbon, pollution or financial transactions);
– a Global Financial Products Safety Commission (to regulate financial instruments globally since it “has been demonstrated that these instruments can destroy even the largest hedge funds, banks, insurance companies, and local governments, as well as the economies of entire countries and the world”);
– a Global Financial Regulatory Authority and a Global Competition Authority (to regulate cross-border businesses given the extent to which national regulatory authorities struggle to do so);
– a Global Council of Financial and Economic Advisors (to “assess long-term trends … identify problems in the global economic and financial architecture, and … provide options for coherent international action”);
– a Global Economic Coordination Council (“elected amongst member states on a rotating basis through regional representations”); and last but not least,
– a World Monetary Board (which would dish out new Special Drawing Right allocations on the basis of need and effectiveness if the IMF proved unable to perform this role).
Well, as you might already have guessed, things haven’t proceeded quite according to plan. (more…)