Strains behind smiles at the family reunion

Almost 30 years after the leaders of the industrialised west gathered for a quiet “fireside chat”, tomorrow’s summit in the French spa town of Evian sees relations between the G8 family strained as never before.

George Bush was making noises of reconciliation yesterday, suggesting that it was time to move on following the deep rift over Iraq. But none of those close to the talks believed that this means the White House has forgiven or forgotten what it sees as French treachery in the weeks leading up to the start of hostilities.

Just as at the first summit in Rambouillet, outside Paris, in 1975, there is plenty for the G8 to get its teeth into during its 36 hours of talks. Potentially, that is.
Just as in the mid-1970s, the world economy is looking distinctly shaky. Then, as now, there is a crisis in the Middle East. Likewise, terrorism. And there are some new issues—the need to put some political impetus behind the stalled global trade talks, the famine gripping Africa and the menace of HIV/Aids.

The G8 has always depended on personal chemistry to get things done. It has no executive power: it relies on the presidents and prime ministers going back to their individual countries and making good their promises.

This year, despite the brave noises coming out of Paris and Washington, the personal chemistry is dreadful. Nothing that has happened since the falling out over Iraq has changed minds either in the United States or in what Donald Rumsfeld called “old Europe”. Bush feels vindicated by the toppling of Saddam and the ease with which the war was won, Chirac and Germany’s Gerhard Schröder by the chaos that has followed and the failure to unearth weapons of mass destruction.

As a result, the meeting will be split between those countries that supported the war—Bush, Tony Blair, Italy’s Silvio Berlusconi and Japan’s Junichiro Koizumi—and those who opposed it—Chirac, Schröder, Russia’s Vladimir Putin and Canada’s Jean Chrétien.

Bush’s stay in Evian has been cut short to little more than a flying visit. He will arrive for tomorrow night’s dinner and fly out after lunch on Monday for the start of the Middle East peace talks in Egypt. The importance both the US and Europe attaches to making progress on the “road map” means that the early departure can be dressed up as diplomatic necessity rather than rudeness. But it is a snub, nonetheless.

Yet although Bush will be in no mood to grant Chirac a big summit success, his offer of a small olive branch suggests that he understands the danger of an acrimonious failure. For while the annual meeting of the G8 is always one part substance to 10 parts choreography, the image matters.

“This is their first meeting since the war in Iraq. Evian is a critical moment in restoring the multilateral process,” said Fred Bergsten, director of the Institute for International Economics, a Washington thinktank. “If these guys go to Evian and cannot show their ability to cooperate, it will be very damaging politically and economically and there would be severe damage in financial markets.”

Chirac remains hopeful that the summit will send out the message that recovery in the global economy is imminent, now that the uncertainty caused by the war has been dispelled and oil prices have fallen sharply.

“Although there is some anxiety [about the recent differences], I am convinced that Evian can convey a message of confidence in world economic growth,” the French president said in a newspaper interview this week.

This would amount to the most modest of successes but may be as good as it gets.

There is a suspicion in Europe that the Americans are deliberately driving down the dollar in order to make US exports cheaper on world markets, thereby deepening economic woes in the eurozone.

Bush and his advisers are urging the Europeans to grow their economies more rapidly; the Europeans say the Americans should put their house in order by reducing their trade and budget deficits before handing out advice.

Nor is there likely to be a meeting of minds on trade, where negotiators at the World Trade Organisation in Geneva are looking for a political lead to make progress on the Doha round of liberalisation talks before a meeting in Cancun, Mexico, in September.

Despite the ritual platitudes, there will be little for Africa either. In the run-up to the summit, Chirac’s proposed an end to EU food dumping in Africa in return for US agreement to stop using export credits to depress agriculture prices. No dice, said the US. This week Mr Bush pledged $15-billion to fight Aids in Africa and called on the rest of the G8 to dig deep. As with the rest of the agenda, G8 leaders will spend the summit talking past each other rather than to each other. The officials who have prepared the ground for the summit know this will be no cosy fireside chat. At this stage, they will be grateful if the crockery stays on the table.

The issues

  • State of the world economy The dollar is plunging against the euro, hurting eurozone manufacturers and benefiting the US, but President George Bush is expected to defend his economic policies, and the G8 will probably present an optimistic assessment of global prospects

  • Postwar Iraq World leaders have already passed a UN resolution suspending sanctions against Iraq; French president Jacques Chirac and German chancellor Gerhard Schröder are likely to call for more international involvement in reconstruction and state-building, as they try to patch up the transatlantic diplomatic rift over the conflict

  • Aids The US Congress has just passed Mr Bush’s Aids bill, which grants a $15bn package of aid. He is likely to urge his fellow G8 leaders to put their hands in their pockets too.

  • Trade Europe will be urged to open up its heavily subsidised agricultural markets to outside competition, but the tone of any discussions is likely to be strained, after the US complained about the EU’s moratorium on GM foods.

  • Africa Chirac is expected to raise the issue of poverty. The UN warned on Thursday that the world would fail to meet its target of halving world hunger by 2015 unless urgent action was taken. - Guardian Unlimited Â
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