G20: One Size Does Not Fit All

• Analysis by Sanjay Suri (london)
• Wednesday, April 01, 2009
• Inter Press Service

There is also something of a united nations kind of speak about the G20 gathering. The leaders of the 20 rich and emerging economies, it is announced, represent 90 percent of global GNP (gross national product), 80 percent of world trade and two-thirds of the world's population.

The suggestion is, agree here, and you can have a global agreement is sorted. And the implication is that everyone is in it together and that everyone needs together to do more or less the same kind of thing; bring financial stimulus, encourage banks to lend, drop protectionism.

This catch-all language, several analysts are warning, is more deceptive than it sounds; it can in fact be dangerous.

'There is this myth that everybody has to follow exactly the same rules in the global economy,' John Hilary, executive director of the rights group War on Want told IPS. 'I think one of the key principles which has been tried in the global trade rules is the principle of special and differential treatment. Which says that what the developed countries like the U.S. or the EU have to do is not necessarily the right type of policy for developing countries to adopt.'

Any acknowledgement of such differences is largely missing from the G20 rhetoric so far. The accent is now on a one-size-fits-all kind of solution that does not seem to leave room for any acknowledgement from developing countries that the G20 must agree that some countries do one kind of thing, and other countries another.

On the face of it that is a discriminatory suggestion; but in effect it is the apparently non-discriminatory language that many are finding discriminatory. The verbalised oneness is taking insufficient note of gaping differences on the ground.

'It is quite clear that there are certain principles and certain policies which are specifically relevant to developing countries at their stage in development, which are no longer going to be relevant to fully industrialised countries,' says Hilary. 'I think it is really important to be able to hold on to that key principle.'

That principle is at the heart of the differences in negotiations on a single world trade agreement. There is a broad push coming from G20 leaders that such an agreement should be concluded; but this is no more than an agreement that there should be an agreement. And without any acknowledgement of that principle of special and differential treatment.

The G20 as a grouping of rich and emerging economies seems to represent wealth and new influence. It is expected now that countries like China and India must pay towards a reformed International Monetary Fund, in which they would then have greater say. The countries are spoken of as the new emerging entities, with little substantive thought for the hundreds of millions of the poor within them. The countries seem not to occupy the nowhere space of rich or at least now richer countries with poor people.

There is of course an acknowledgement of poverty around the world and that the G20 must do something about it – such a gathering could hardly be complete without statements of that kind. But the G20 meeting can expect to be measured by the number of dollars that are attached to those words, amid fears that the G20 meeting will be rich only in statements of the right sort.

Putting numbers to words, the international charity Oxfam has asked G20 leaders to produce a 580 billion dollars a year rescue package for poor countries made up of an immediate fiscal stimulus for the poorest countries of at least 24 billion dollars, debt relief, and fulfilment of existing pledges to increase development aid.

That sounds like a lot of money, but is a fraction of 8.42 trillion dollars promised by rich country governments to bail out banks, Oxfam says. This kind of bailout package, it says, would be enough to end global extreme poverty for 50 years and a massive step towards ending it forever.

'When you look at the amount of money that has been found for banks it seems inconceivable that G20 leaders will stand aside and allow the economic crisis to destroy poor peoples lives,' Oxfam chief executive Barbara Stocking said in a statement. 'Developing countries are reeling from dramatic declines in trade, remittances and foreign investment. Rich governments whose policies contributed to the crisis have a responsibility to help those who cannot afford their own bailouts.'

Without urgent action, she said, 'hundreds of millions of the world's poorest people will fall further into poverty. Losing your job is devastating wherever it happens but for millions people in poor countries, without benefits and health services to fall back on, unemployment will push them into destitution.'

And yet, nobody is expecting anything like that kind of money coming from the G20, or even a small fraction of it. Or even much acknowledgement that different policies are needed for different countries.

'I think what we will see from the G20 is a statement of intent and best endeavour clauses which say that countries will not be going hell for leather for protectionism,' Hilary told IPS. 'But I don't think we'll have the same sort of subtleties of saying there must be one rule for developed countries and one rule for developing countries.'

Answers like outside of the G20, Hilary says. 'What's really important here is for developing countries not to look to the G20 as some sort of saviour for their problems. The G20 is a group of self-interested rich and emerging economies. They're not going to be delivering the sort of future that the people of the world need, so I think we should be looking elsewhere for the real change we need.'

© Inter Press Service (2009) — All Rights ReservedOriginal source: Inter Press Service

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