The Emerging Powers Take the Reins

Operations at the 2010 summit will be influenced by the national interests of states on the rise, like Brazil and India.

Canada is hosting two economic summits this week: the G8 and the G20. Of the two, it is the G20 where the most important decisions will be made.

After the global economic crisis of 2008, the G20 acquired renewed significance. It came to be seen as the most effective forum to address matters pertaining to the health of the global economy because it included the heads of government of both the leading industrial states and the emerging economies.

The result of this, however, is that it operates under the cloud of foreign policy priorities of the emerging powers. On a range of issues, the emerging powers have shown a willingness to confront the world view represented by the states of the old G7 club. From climate change to the proliferation of nuclear weapons, the emerging states are asserting their national interest.

In the economic sphere, we have already seen this assertion in the shift of voting rights at the World Bank, which increased the share of votes for large emerging economies such as China, Brazil, and India at the expense of the U.S., European states, and the Japanese. This is a small but symbolic move. It reflects not only an economic shift in international relations but also a geopolitical shift. Emerging powers are exercising greater political influence to bring about changes in the way institutions of global economic governance are run.

Iran and its nuclear weapons program are likely to remain on the minds of G20 leaders during the Toronto summit and well into the future. This is an area where there are significant differences between the approaches of the old G7 states and those of the other G20 members. Recently, the UN imposed economic sanctions on Iran for going ahead with its nuclear ambitions. Brazil and Turkey, two leading members of the G20 and also non-permanent members of the UN Security Council, voted against the UN sanctions on Iran. They also brokered a separate guarantee with Iran on the reprocessing of enriched uranium.

Both Brazil and Turkey have significant foreign policy ambitions as major power brokers in the international system. China voted for UN sanctions but did so with some reservations. It ensured that the sanctions regime did not impact negatively on Beijing’s trade interests with Iran. Russia has criticised unilateral U.S. and EU sanctions that go beyond those approved by the UN Security Council. Therefore, as the G20 convenes, it does so under the shadow of foreign policy and geostrategic priorities of several member states.

Another significant trend in international relations that may cast its shadow on the effectiveness of the G20 in the years to come is the rise of non-western economic and security forums. The Shanghai Cooperation Organisation (SCO), the BRIC Summit, and the Conference on Interaction and Confidence-Building Measures in Asia (CICA) are some examples of this trend. On climate change negotiations, Brazil, South Africa, India, and China have formed a coalition known as BASIC, which opposes the American and European demand for mandated limits on greenhouse gas emissions. All of these groupings include the emerging powers with an understated goal of containing the influence of the U.S. and the EU on a whole range of global policy issues.

Substantial agreements can be achieved at G20 meetings. However, there will always be that moment when foreign policy and the geopolitical priorities of some member states will rear their heads to dampen the effectiveness of the forum. The G20 walks on a tightrope.