Italy G8: Poverty of Principles and Fragile Gimmicks-I

-By Dr. Abdul Ruff Colachal

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Reckless Capitalism causes Recession and Emissions  

It is said matured capitalism would arrange for the total disorder and decay in societies. Today the world is fast witnessing symptoms of that phenomenon. As a routine matter to boost profit avenues for reckless capitalist formations around the world, the world's most powerful capitalist plus leaders gathered for the G8 summit three-days from 8 to 10 July in an Italian earthquake zone in the town of L’Aquila, where damage is still clearly visible from a quake measuring 6.3 on the Richter scale which killed almost 300 in April. The 2009 G8 Summit of the world's richest nations Canada, the Russian Federation, France, Germany, Japan, Italy, the UK, and the USA, together with the EU represented by the European Council's duty President and by the President of the European Commission generated a lot of expectations amid the meltdown. In addition to its traditional members, the Italian duty Presidency had invited to the Summit the countries that make up the Major Economies Forum, the NEPAD (New Partnership for Africa's Development) founder states, the representatives of the African Union and Spain, Turkey and the Netherlands.

Even as the global state terrorists led by the America are adding to the environmental pollution plus climate change with their illegal invasions destroying Iraq, Afghanistan and Pakistan and killing defenseless Muslims there to the tune of a million, the overarching objective was to inspire more effective global governance, while also prompting such a system to become more representative of the current economic power structures. Multilateralism is the key focus of the Italian diplomatic efforts targeted at the enhancement of “axis of responsibilities.” The multicolor themes are global financial crisis; Africa and international development assistance; climate change and energy security; nuclear non-proliferation; and, regional crises with a particular focus on the Afghan situation.  The key issues on the agenda, however, are directly linked  to Italy’s own problems: a response to the global economic and financial crisis; the restoration of grassroots confidence and a boost to growth on a more solid and balanced basis, also through the definition of new, shared ground rules for economic activities; a focus on the social aspect of employment, to help the weaker sectors of society both in the industrially advanced countries and in the poorer countries; the struggle against protectionism and the deregulation of world trade for everyone's benefit; the resolution of regional crises; food security and safety; and the struggle against climate changes. To debate essentially the economic and environmental issues, the Italian Presidency organized a G8 Summit which is perhaps unique in terms of the number of countries attending, comprising as it will both the emerging countries, Africa and the main International Organizations. 

Italy currently holds the G8 industrialized nations Presidency and Italian president Silvio Berlusconi switched the summit venue from posh Sardinia to show solidarity with quake victims and has faced criticism for the supposedly chaotic preparation for the event for "professional run". The purpose of the G8 – the main industrialized ‘democracies’ forum for dialogue – is to come up with fresh answers to the main global political and economic issues. The Group kicked off with debate on the economic crisis, after what one analyst called a "reality check" in recent weeks on the prospects for rapid recovery.

G8 leaders badly underestimated the economic problems facing them when they met in Japan last year and were expected to focus on what must be done to prevent another meltdown. Although there have been signs of stability in the economy and the sentiment has improved, the real economy has not recovered yet with job and wage conditions still stagnant. Britain sought progress on the agreements reached at the G20 summit in London in April to reform the international financial system and pump billions into the world economy. Ahead of the summit, Brown said the international community must maintain its focus on restoring lending by banks, reining in oil prices - which have risen by 75 per cent this year - and fighting protectionism. G-8 summit has suffered a setback with Chinese President Hu Jintao's return home to deal with rioting and killings of Muslims in Xinjiang. President Obama voiced confidence that leaders will maintain their support for economic stimulus strategies in the face of a global recession.

On the first day of a meeting, the G8 failed to get global polluters China and India to accept the goal of halving emissions of greenhouse gases by 2050. China, the top most polluter of the global environment causing fear among the island nations, did not pat take in the deliberations because President Hu Jintao had left the venue on account of domestic political problem resulting in the death of Muslims. President Obama chaired the 17-member Major Economies Forum(MEF), comprising the world's biggest carbon emitters USA and China and also including Australia, Indonesia, South Korea and the EU, in a meeting designed to pave the way for a post-Kyoto agreement on action to halt global warming at Copenhagen in December.

Talk about global currency irritates USA because Dollar is losing out to Euro. Not mentioning China’s push for a sensitive debate about a long-term alternative to the dollar as global reserve currency, the draft talked only of global "imbalances." G8 diplomats had said this might be the only oblique reference to currency. "Stable and sustainable long-term growth will require a smooth unwinding of the existing imbalances in current accounts," read the draft prepared for the G8 talks. China complains that dollar domination has exacerbated the global crisis and worries that the bill for U.S. recovery poses an inflation risk for China’s dollar assets, an estimated 70 percent of its official currency reserves.

After discussing the core economic issues at G8, other less important nations were asked to join them the following day for the report and possible necessary joint action. So, on 09 July G8 “big” nations were joined by the "plus five" group of emerging economies China, Brazil, Mexico, India, and South Africa to discuss climate change and development. The G5 urged rich nations to remove trade barriers and restore credit to poor countries. The G8 and G5 did hope for progress on the stalled Doha trade talks, with agreement possible on concluding them by 2010. Launched in 2001 to help poor countries prosper, the Doha round has stumbled on proposed tariff and subsidy cuts.

No agreement was either expected or reached, but Britain hoped L'Aquila would act as a springboard for agreement later in the year on 50 per cent cuts in CO2 by 2050. Obama said on 09 July there was still time to close the gap with developing powers on climate change, after the U.N. chief criticized the G8 for not going hard enough. Obama said progress could still be made before talks on a new U.N. climate change treaty in Copenhagen in December.

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Dr. Abdul Ruff Colachal

Independent Researcher in International Affairs, The only Indian to have gone through entire India, a fraud and terror nation in South Asia.