Global governance reforms:  futility or hideous gains?

Dr. Noor Fatima

The time has gone when nation state was able to cope with all challenges at their own. Establishment of Bretton Woods institution after WW-II was to ensure such a system to be in place. However, when US post war hegemony was challenged by other industrialist countries, which were also competing with the US. In 1976 the elite group of industrialized countries became G7/G8. This includes United States Britain, Canada, France, Germany, Italy, and Japan and now added Russia. By virtue of group of seven, economic, political and military power was able to influence the multinational institutions of global governance; they can influence the program of UN, WB, and IMF & OECD. Nonetheless, one canít ignore the facts that it is a two way enforcement of action. They both correspond to each otherís economic power. A joint venture of multinationals and respective countries intertwined to forward this agenda

The declaration of G8 summit every year is full of promises reflects the consensus of world most influential group over global economic issues. Thus it is considered that human kind would be heading for a future peace and prosperity only if this influential group is able to design a global governance system of reforms.. The question is that what can be expected when leaders get together in G8/G7? What’s new? South was watching with inquisitive over alarming global economic problems & looming recession and ears were set on last week G-8 meeting in Japan.  Hopes were high that these Gs would invoke a plan to save the world from high price of oil and food from pushing the world into crisis.

These economic giants meet every year with the greater issues of Global Governance for economic as well as environmental issues.  Do they, who hold two third of this earth’s wealth can really care about the marginalized world, is the question. Situating themselves at the centre of global governance, do they feel any gap between the pronouncements of the concerns and policy reforms or not. Have they been successful to advance solution to the array of economic, political and transnational issues or are the power of this influential group is also undermined by the sole super power and these elitists can care about nothing except for their benefactors - the multinational corporations as G8 has driven neo-liberal globalization. Foremost, why obstinacy and indecisiveness about world goals for equitable treatment of all nations, which they claim is vital.  

It is not only the UN system, WTO or Bretton Woods Institutions but G8 plays an important role in global governance, as they hold power and money.  Though it is two way process, the multinationals also reinforce the strings through G8. Thus these are important questions and they deserve to be considered carefully by the stakeholders in the global governance debate.  There were many issues calling attention of this summit like, international economic storm, food crises, energy crises and environment issues. The point is what did they do when they assembled in Japan last week?

They focused on reinforcing the commitment of achieving MDGs. Now just reinforcing the MDGs is not the solution of the economic crises of the present developing world to be specific. The trend of indicators of MDGs goals so far reveals that most the developing countries including Pakistan are still not on the full track to achieve MDGs by 2015.

The other major decision was to halve emission by 2050. Nonetheless, one cannot ignore the fact that it was passed in 1997 and came into force in 2005 where first time countries agreed to limit CO2 emissions, but it only amounts to very small steps towards emission issue. USA and Australia are not still part of Kyoto Protocol and emerging economies such India, China and Brazil is till offside. The process how to proceed in reduction of emission is moving very slowly, multinationals are resisting it and processing is made many year backward. What appears is that global policy making on environment is not adequate despite United Nations Environment Program and other many initiatives, there is still lack of global influential organization in environment to correspond the worldís most influential agencies dealing with trade and finance like WTO, WB and IMF. But the depressing point is that ecological system of world would not wait for us to have an effective global environmental policy in place, as danger is growing where ecological system will be out of its balance. What we do not in incognizant of that the consequence of climate change brings destabilization and violence in many part of the world, which hinders the development. Therefore international community and economic giants should take critical measure to limit the climate change as it is more harmful for the developing countries which actually are least responsible for climate change and most vulnerable to its impacts.

This brings to the paradoxical role of WB in the context of reducing global warming. The World Bank, whose stated mission is to alleviate poverty and assistance in sustainable development , since last three decades is helping developing countries to reduce debt burden through the development projects like financing of industries, oil extraction, mega-dams, logging, and industrial plantations; while these development are considered the environmental threats. Though, development is necessary evil with inherent imbalances of the environment, therefore environmental assessment and development projects are causing now serious reservation of WB commitment of the development projects.

On food crisis, G8 called on surplus nations to assist the nations with shortages and to remove export restrictions. Though, they pledged for lifting export restrictions that would be helpful, but are they ready to rethink about their own agriculture protection policy, which impedes the production in developing counties, is the question. Food stocks are dwindling world wide and as per FAO they are now all time low. Keeping this in view many countries are rationing and India has already banned the export of rice. Food-price inflation will also bring serious setback in attaining MDGs goals which woes to half hunger by 2015. According to WFP the most effected are the small farmers and landless in developing countries. What these influential economic group  needs to realize is that the gap between rich and poor is widening at global level, social exclusion is increasing and fruits of economic globalization is not fairly shared. The developing countries are not self-sufficient in food. Profiteer of the world system are to stabilize the pries at one pint, which is gainful for them, throw extra stock in sea, which can otherwise if brought in the market will lower the prices and meet the needs of the undernourished.  There is a critical need of extending financial and food support to save the countries instead just endorsement that poor countries needs financial support. Since there is no mandatory clause to this effect therefore, it is doubtful if this buzzword will bring fruit.

Finally the G-8 called for an increase in oil production as it was thought that “higher oil prices were due not just to changes in supply and demand, but also to a failure by oil-rich nations to build enough wells and refineries”, while turning a dumb ear to the fact that there is greater part played by speculators, manipulators and stock brokers in the oil market. Who is gaining out of these crises? This enigma can be resolved by analyzing in depth the bond between these speculators and multinationals. 

So what did the economic giants do? Do they talk much and do little? All that is required is real initiative. Finally return to where it began- Coordination for global economic issues between these countries to address the social and economic polarization and marginalization for which these influential groups are primarily responsible. The G8 without inclusion of emerging economies and other developing countries at least as an observer cannot address the issues facing by the emerging economies. What is lacking is the policies to ensure the global governance through strong institutions at global level to execute policy with inherent legitimacy. G8 can improve its credibility as a central forum of world leaders for developing countries to see a dawn of genuine development policy if a change becomes visible in the light of past failure.