Time for G-20 to address its legitimacy

The article in Al Hayat on 7 April 2010 (Arabic) (pdf)

 

 

The spirit of the 1815 Congress of Vienna, where great powers assembled to determine the world’s fate, has no place in the contemporary international community. The Group of 20 (G-20) is sorely lacking in legitimacy and must change.

Though rising deficits and growing unemployment still plague rich and poor countries alike, it appears that the worst of the world’s financial crisis is over. Now the question becomes how the international community can devise exit strategies from the ‘Great Recession’. That conversation has already started and it will, to a large degree, take place in the G-20, culminating in the group’s summits in Canada in late June and in South Korea in November. Despite its leading role in response to the global financial, economic and development crises, the self-appointment of the G-20 represents, from the point of view of international law and multilateral principles, a major step backwards in the way international cooperation has occurred since World War II.

Over the past few years, the G-20 has rapidly established itself as the premier forum for international financial and economic decision-making. It has replaced the G-7 and G-8, and is progressively sidelining established international organisations such as the World Bank, the International Monetary Fund (IMF) and the United Nations. With each meeting it holds, the G-20 is institutionalising itself as a major body of global cooperation and governance, and the political significance of that goes beyond saving the global finance system. This development has had its benefits. The unprecedented cooperation and coordination the G-20 enabled among established and emerging powers helped stabilise a world economy driven to the brink by the financial crisis.

But now that the worst of the crisis has begun to fade, the G-20 should address the question of its own legitimacy and evolve to better reflect the interests of the nations its actions affect. To be sure, the G-20 is more representative than the G-7 and G-8 - but it is sorely lacking in legitimacy. It is not an elected body; it is a self-appointed group, established without the consent of other nations. A number of countries that have been central to international cooperation in the past - including Norway and the Nordic countries - are excluded from direct membership. Low-income countries and the continent of Africa are almost entirely without representation.

Whereas the G-7 was a group of the world’s richest economies, the G-20’s composition lacks such clarity. Indeed, a number of non-participants, including the Nordic countries, are major financial contributors to development and to the Bretton Woods institutions. They are of greater ‘systemic significance’ and have larger gross domestic products than several G-20 countries. As the response to the financial crisis showed, there is value in having an effective forum of nations, equipped to act quickly when necessary. But within that framework, there are simple ways to make the G-20 more representative of the world it influences. As a first and immediate step, G-20 members and non-members should consult on a framework for interaction.

More fundamentally, a system of geographical constituencies - along the lines we already have at the IMF and the World Bank - freely constituted and with the present G-20 members as a core, would go a long way in remedying the weaknesses of the present system. For instance, the Nordic and Baltic countries have long been effectively represented at the IMF and the World Bank through a regional constituency. This model could be usefully replicated within the G-20.After all, the global economy is just that: global. We live in an interconnected world, where any country’s economic decisions can have a bearing beyond its borders, with Greece’s recent debt troubles being one example. Representation at the G-20 will become all the more important as its agenda moves beyond economic concerns to include issues like public health, development and climate change - issues with real consequences for all nations.

Respect for international law and global legitimacy as the basis for multilateral cooperation is a necessity. It is also a tradition Norway holds dear. Our faith in multilateralism is derived not from naiveté, but from hard-nosed idealism, forged in the aftermath of a brutal war that nearly tore the world apart. The founders of the great post-war institutions recognised the merit of limited or weighted membership within the larger bodies - but they also insisted on the importance of multilateral approval anchored in international law. Now is not the time to turn back the clock. We are no longer living in the 19th century. The spirit of the Congress of Vienna has no place in the contemporary international community. If the G-20 cooperation should effectively result in decisions being imposed on the great majority of other countries, it will quickly find itself stymied. The house of global governance cannot stand if it is divided against itself.