Responsibilities shifting inevitably from G8 to G20

By Chris Cermak Jun 26, 2010, 10:36 GMT

Toronto - In the world of global summitry, there is a sense of inevitability about the shift in responsibilities from the Group of Eight (G8) bloc of rich nations to the larger grouping of the Group of 20 (G20).

The shift was brought on by necessity: the 2008 financial crisis forced world leaders to come together to help avert a 1930's-style global depression. With the greater interconnectedness of the global economy and the growing muscle of major developing economies, a purely rich-world response would have looked woefully inadequate.

The G20 brought along major developing powers that have long clamoured for a seat at the decision-making table, including China, India, Brazil and South Africa. The G8 is made up of the seven leading developed countries - Britain, Canada, France, Germany, Italy, Japan and the United States - plus Russia.

The success of the G20 in coordinating public spending measures spurred leaders in September to declare the body the premier forum for global economic cooperation. With wealthy economies still sputtering, developing powers are set to contribute about half to global growth this year, further justifying their increased role.

But the like-minded industrial nations and democracies that make up the G8 are still resisting a wholesale shift in responsibilities to the G20.

Canadian Prime Minister Stephen Harper chose this weekend to host the G8 and G20 summits back-to-back. French President Nicolas Sarkozy has indicated he will do the same when France chairs the blocs in 2011.

US administration officials at the Toronto summit this weekend argued that the G8 remained 'an important forum for coordinating development assistance.' Harper said the bloc still has a role to play in security and mobilizing aid for poorer countries.

'We still are the richest and in fact the most powerful countries in the world,' he told reporters.

Rich-world powers may have rejected the idea for now, but experts say it is only a matter time. South Korea has said development will be discussed when it hosts the next G20 summit in November. Climate change, already discussed in some contexts, may be next.

'You will see agenda items begin to migrate,' said Heather Conley of the Washington-based Centre for Strategic and International Studies.

David Shorr, an expert with the US-based Stanley Foundation, argued that the G20 had already shown its potential in helping avert a global crisis and will eventually take on even security issues.

The G8 was safe in the near term, but Shorr predicted world leaders will eventually have 'the same realization about needing everyone around the table for political and security affairs that they had for economic matters.'

There is a case to be made for the like-mindedness of advanced economies and democracies: it helps leaders reach agreement faster, while dealing with emerging powers like China has proved more difficult.

Major cracks have already begun to show in the G20. The United States and EU disagree on whether to maintain the global recovery with more spending or a return to fiscal discipline.

China has resisted calls to lower its massive trade surplus. But an announcement just ahead of the G20 summit that it would allow its yuan currency to appreciate was taken as a sign that China, too, can be swayed by international pressure.

'World leaders' calendars are a precious commodity,' Shorr said. 'Given the choice for a day and a half's block of time to get world leaders together, I think that you can tackle more of the difficult political issues in a larger and more diverse group.'