Sir Nicholas Bayne. The G8's Past Performance, Present Prospects, Future Potential
Sir Nicholas Bayne
London School of Economics and Political Science
for the 2000 G8 Pre-Summit Public Policy Conference,
The Kyushu-Okinawa Summit: A G8-Developing Country Dialogue, July 17, 2000, United Nations University, Tokyo
A. Past Performance: Some Summit History
Let me begin my remarks with some summit history. I shall draw on two books. One is Hanging Together: the Seven-Power Summits, written by Professor Robert Putnam and myself in the mid-1980s, when a Japanese version also appeared. The other is Hanging In There: the G7 and G8 Summit in Maturity and Renewal, which I brought out earlier this year.
Okinawa is the 26th summit in an unbroken sequence going back to 1975. The first summit of all had only six members – the United States, Japan, Germany, France, the United Kingdom and Italy. Canada and the European Union were soon added, to form the G7. Russia made it up to G8 only since the Birmingham summit of 1998.
The summits were created for three purposes:
To provide collective management of the world economy, with Europe, Japan and Canada sharing responsibility with the United States;
To reconcile the tensions of interdependence, created because external factors were increasingly penetrating domestic economic policy;
To generate political leadership, where heads of state and government take cooperation further than their officials and ministers can.
These objectives remain just as valid in 2000 as they were at the beginning. The only change is that globalisation has replaced interdependence – more of that in a minute.
I have identified four phases in the summit's history so far; innovation, establishment, maturity and renewal. These are defined as follows:
The first phase, of innovation, lasted from 1975 up to 1982. These early summits set demanding objectives for cooperation, chiefly in monetary issues and macro-economic cooperation, but also more widely.
The next phase, of establishment, covered the rest of the Reagan presidency, up to 1988. These summits were less ambitious and achieved less cooperation in economic matters, paying more attention to political subjects.
The end of the Cold War in Europe gave a new direction to summitry in its phase of maturity. The summits sought to encourage working democracies and market economies in ex-communist countries. They gave new priority to trade, to debt relief and to the environment. But overloading the agenda led to frustration.
I date the renewal of the summit from 1994 – and it is still going on. The stimulus to renewal was the advance of globalisation and the need for a summit response. But this renewal also led to a major change in the summit format, starting from the Birmingham summit two years ago. Since Birmingham the heads have met on their own, as they will in Okinawa. Their supporting ministers now meet separately; for example, finance ministers at Fukuoka ten days ago, foreign ministers at Miyazaki a week ago. So the heads have detached themselves from the proliferating G8 apparatus, regaining more freedom to innovate and launch their own initiatives.
I now want to look more closely at how these changes in both substance and format impact on the summit and its capacity. I start with the content of renewal, which I relate to present prospects.
B. Present Prospects: the Content of Summit Renewal
The first response to globalisation from the summits concentrated on reform of the international economic system and its institutions. The aim was to strengthen the system to withstand the strains of globalisation. This work still goes on and I will return to it shortly.
Since Birmingham in 1998 the summit leaders have also focused on the domestic demands of globalisation. They have identified themes where globalisation arouses the fears of their own peoples – fears of loss of jobs, rising crime and financial panic. They recognise that their electorates are nervous of globalisation, because it makes them vulnerable to external forces beyond their control.
In these domestic issues, each recent summit has focused on different themes: Birmingham in 1998 on employability and crime; Cologne in 1999 on social security and education. Okinawa has chosen IT and ageing. Many of these issues had been treated previously, some going back to the dawn of summitry. But globalisation obliges the leaders to treat them in a new way, with international factors going deeper than ever into domestic policy-making.
But the work on the international response to globalisation, begun in 1994, is far from complete. Some measures agreed earlier have not proved sufficient or the problems they addressed have returned in a different form. On these issues the summits involve an iterative dialogue with international institutions. This iteration is necessary because the summits do not always find the best solution at their first attempt. After all, only the most intractable problems come up to the heads of government – easy ones are resolved at lower levels.
Here are some examples, relevant to Okinawa:
First, in finance, the response to the Mexican crisis agreed at Halifax 1995 did not deter the more serious speculative crises of 1997-98, in Asia, Russia and Brazil. The summits at Birmingham and again at Cologne last year gave much attention to new international financial architecture. Most of this is now in place at the International Monetary Fund (IMF) and the World Bank and calm has returned to the world economy. But the new systems have yet to be tested under stress and the exact division of roles between the Fund and the Bank remains in debate.
Second, in trade, the last summit held in Japan, back in 1993, was very productive. It broke the final deadlock in the Uruguay round negotiations and led to the creation of the World Trade Organization (WTO). But more recent summits have neglected trade; the G8 have failed to settle outstanding differences between themselves. This contributed to the collapse of the WTO meeting at Seattle last December, with no agreement on a new trade round and the alienation of developing countries. At Okinawa the G8 ought to reach agreement on how to restart the WTO process. If they are not ready – and I fear they are not – they should at least resolve to make it their first objective for next year's summit in Genoa.
Third, the leaders have paid more attention to debt and development issues, especially since the Lyon summit of 1996. They recognise the risk that poor countries can be marginalized by globalisation. The Cologne summit last year marked a major advance in debt relief for poor countries, welcomed by the Jubilee 2000 campaign of NGOs. But implementation of debt relief since then has been disappointing. In other measures to help the poorest, the summit has failed to live up to its promises, for example in trade access for low-income countries or the untying of bilateral aid. The G8 must improve on its performance in this area and restore its reputation. For example, Okinawa is expected to set new targets in eradicating infectious diseases. This is an essential aspect of development. But new targets are not enough; there should also be commitments of the resources needed and measures to involve private business and NGOs active in this field.
C. Future Potential: the Consequences of Structural Reform
In the last part of my remarks, I want to suggest some ways in which the changes in the summit format offer new openings for what the summit can do.
In the past, the freedom of summits to take the initiative has often been stifled by their bureaucratic apparatus or by overloading the agenda. The new format cuts the heads loose from the expanding G8 apparatus. Other ministers can be left to pursue issues at their level, enabling the heads to choose their own agenda.
The summits hitherto have been entirely a governmental operation. The leaders now have the chance to spread the summit process beyond governments. They should reach out to private business, the main driving force behind globalisation. The idea of the Japanese hosts to invite major firms to a high-level conference on information technology just before the summit is a good initiative. But more needs to be done to link the summit process to the private sector throughout the year.
The heads of government should respond better to NGOs, especially those that reflect popular anxieties about globalisation. Many NGOs have high ideals of service and valuable expertise, for example in the environment or development; the G8 should encourage them and cooperate with them. But others combine violent opposition to globalisation with a challenge to the democratic legitimacy of governments; they should be resisted. The heads of government should actively make the case for globalisation, drawing on all their technological resources, and not leave the field to those who tried to obstruct the WTO in Seattle or the Fund and Bank meetings in Washington. Only heads of government really have the authority to do this. Their annual summit gives them the potential to generate a powerful collective message.