G- 8 vs The Rest of the World

Dr. Abdul Ruff COLACHAL

Rising oil and food prices not only fuel inflation but also hamper global growth by hurting businesses and consumption, posing a serious challenge to policymakers who cannot control the increasingly globalise, free-market economy.

Many concur on the fact that there is a limit to what governments can do now. It is important to reach a global consensus on what’s happening in the global economy, but the summit cannot always trumpet action plans.

The leaders from the advanced economies G8, the USA, Britain, Canada, France, Germany, Italy, Japan and Russia, gather at the July 7-9 summit in Hokkaido, northern Japan to debate on the concerns that a weaker dollar is a factor behind high oil prices.

Bush and Japanese Premier Yasuo Fukuda were expected to voice support for a goal of doubling crop production in Africa. Japan is dependent on imports for some 60 percent of its food, more than any other G8 country.

A number of developing nations have restricted exports to ensure they can feed their own populations. Japan, in a summit with African leaders in May, pledged to use its expertise to help double rice production in Africa over the next 10 years to alleviate food shortages.

At the outset it should be stated that with finance ministers and central bankers absent, the G8 will probably make little headway. While inflation was on the agenda, the G8 chiefs would not make interest rate recommendations to central banks.

“It is being questioned what kind of a message we will be able to send on rising oil prices,” said Japan’s point-man in pre-summit negotiations, Deputy Foreign Minister Masaharu Kohno. He added that “there may not be a revolutionary panacea” for solving the problem of surging oil prices, which hit a record high of $145.85 last week.

One

The Organisation

The Group of Eight (G8) is an international forum for the governments developed world also meet throughout the year, such as the G7/8 finance ministers (who meet four times a year), G8 foreign ministers or G8 environment ministers.

At a very critical moment of world capitalism during the 1970s, the G8 was established to form a consensus among the imperialist nation-states. Over years it has become the cornerstone of the neo-liberalist globalization that the world is confronting.

The ‘consensus’ signifies nothing short of finding out the most convenient means of driving global financialization, privatization, commercialization, and militarization and camouflaging these processes as if they were for the public well-being.

The concept of a forum for the world’s major industrialized democracies emerged following the 1973 oil crisis and subsequent global recession. The group does not have a permanent secretariat or offices for its members.

In 1974 the United States created the Library Group, an informal gathering of senior financial officials from the USA, the UK, West Germany, Japan and France.

In 1975 Italy joined the club and the six leaders agreed to an annual meeting organized under a rotating presidency, forming the Group of Six (G6). Canada joined a year later in 1976, making it the G7. Under severe international pressure, Russia was invited to join after the collapse of the Soviet Union in 1991 and formally became a member in 1997, making forum now known as G8.

Ahead of G8 summit, Japan announced an additional 50 million dollars to help developing countries cope with soaring food prices, increasing the momentum for action at the summit.

Japan is in the midst of pushing for neo-liberalist reforms and the fortification of the security-state in Japan, while persisting in sending troops to Iraq as a simple-minded follower of the US strategy for its global military rule.

At the same time, its main objective is to amend Japan’s constitution in order to complete the long-lasting ambitions of otherwise imperialist Japan.

Two

Price Rise

Capitalism provides for constant price rise affecting common people very badly. As record high oil prices threaten the global economy and food riots undermine political stability in some countries, the G8 would, however, try to draw up measures to balance the supply and demand of oil, officials from member countries said. It will also aim for closer cooperation with oil producers.

Rising oil and food prices not only fuel inflation but also hamper global growth by hurting businesses and consumption, posing a serious challenge to policymakers who cannot control the increasingly globalize, free-market economy.

Many concur on the fact that there is a limit to what governments can do now. It is important to reach a global consensus on what’s happening in the global economy, but the summit cannot always trumpet action plans.

Without any clear legitimacy for deciding planetary affairs, the so-called Group of Eight under the leadership of USA have self-appointed themselves world ruler. They are in fact spreading poverty, violence, hatred, segregation, and environmental destruction.

The Group of Eight (G8) leaders aim to present a united front against global inflation, driven by soaring oil and food prices, at a summit in Japan next week, but solving the problem requires more than just a strong message from rich nations.

African leaders will join the group for one day to discuss pledges made in a summit in 2005, to double aid to the continent by 2010, though the issue may be pushed down the agenda by a focus on surging food and oil prices and economic worries.

British PM Gordon Brown has said the G8 must commit to united actions to tackle poverty and climate change and must not retreat into isolationism. “Instead of sidelining climate change and the development agenda, the present economic crisis means that instead of relaxing our efforts we have got to accelerate them.

Three

Climate Change

The host of G8, Japanese premier Yasuo Fukuda, would like to make climate change a centrepiece of the summit, but divisions within the G8 and between rich and poorer countries over how to share the burden of reducing the greenhouse gases that cause global warming have cast doubt on how much the leaders can achieve.

Environmentalists are urging the G8 to set bold targets for cutting C02 emissions by 2050 and interim goals for how to get there in order to boost momentum for U.N.-led talks on a new framework for after the Kyoto Protocol expires in 2012. Those talks are set to end in Copenhagen next year.

Countries like China and India also have to contribute to global efforts on cutting emissions, but ambitious mid-term targets by industrialized nations are a crucial prerequisite.

G8 has large responsibility for the climate change. At the Toya Lake summit in 2008, the main theme will be environmental problems. It is the G8 that ravages the natural resources of the world—even resorting to arms—and discharges more than 40% of the planetary carbon dioxide, hence instigating the climate changes. Shinzo Abe, the leader of Japan, had invented a vain slogan: “Invitation to the Beautiful Stars” which proposes in substance the exportation of nuclear power plants to developing countries.

Four

Anti-G8 Protestors

As the G8 summit approaches, some countries blame a weaker dollar for pushing up oil prices. As the US currency declines, it costs more to buy oil and gold in dollar terms, and thus, a weaker dollar can exacerbate rises in commodity prices. Against this backdrop, the USA is increasingly finding itself having to defend its economic policy to foreign leaders who are battling inflation.

The G8 leaders could discuss the dollar as one factor behind surging oil prices. Whether such currency talk will help is another question. With the European Central Bank raising interest rates to their highest level in nearly seven years, US efforts to talk up the dollar seem to be in vain.

Summits of the G8 have become a magnet for protesters angry about everything from climate change to the effects of globalization. Thousands rallied in northern Japan calling for the G8 rich industrialized nations to be disbanded on July 05.

The 90-minute march by Japanese and foreign activists took place under heavy security ahead of the July 7-9 meeting at the Hot Spring and Lake resort of Toyako. The protesters banged drums and carried colourful banners proclaiming “Shut Down the G8” and yelled: “We are against a summit of rich nations.” “Cats are against the G8 too,” read one large cat-shaped placard.

The one-and-a-half hour march by Japanese and foreign activists, citizen groups and non-governmental organizations took place under heavy security ahead of the July 7-9 summit of the rich nations at the Hot Spring and Lake Resort of Toyako 70 km (45 miles) away. Japan has detained and questioneddozens of people at its airports, including journalists and academics, in the run-up to the summit, although many have been allowed to enter the country after several hours.

Five

Back to Square One?

Previous G8 summits have been marred by clashes between police and protesters. The security budget for this year’s summit is said to be more than $280m (140m Sterling Pounds), far higher than the year before.

Japan is concerned about violent protests as well as acts of terrorism during the summit and has tightened security around the country at a cost of some 30 billion yen ($283 million), topping the 113 million euros ($186 million) spent at the last summit in Germany.

Around 21,000 police officers are being deployed in Hokkaido and domestic media have said a similar number have been mobilized in Tokyo.

Recent food crisis and rising prices are being engineered by G-8 for more profits. The G8, even human rights and poverty are just another opportunity for capitalists’ expropriation.

At the 2007 summit in Heiligendamm, one of the main themes was the poverty in Africa, but what they proposed as a measure to combat it was, shockingly, the deregulation of investment in Africa.

But no follow-up action was properly initiated as yet. The World Bank estimates up to 105 million people could become poor due to rising food costs. Helped by surging oil and commodity prices, food security has muscled its way onto the summit agenda.

The G8 leaders are likely to issue a separate statement on food prices. The statement will probably call on Governments to release available food stockpiles or reserves to global markets and seek steps to boosts agricultural output in developing countries.

In the past the G8 has expressed concerns about human rights and poverty. German Chancellor Angela Merkel stressed the need for a human-faced globalization.

But these very state have been violating human rights on the pretext of the “fight against terrorism”, eliminating public education the world over, privatising almost all the resources left for humanity — land, water, and food — and preys on the increasing global poverty, producing and exports more than 90% of the world’s weaponry and make the weaker nations buy them and kill people.

Kyodo news agency reported on July 03 that the leaders would vow to closely watch crude oil futures markets and stress the need to save energy by developing and using new technologies and alternative energy sources.

The draft for the G8’s post-summit statement says joint efforts were necessary to expand investment in the development of oil supplies. The draft also highlights the importance of open raw materials markets for the efficient allocation of resources.

An analyst said oil prices would stay high partly due to speculative money flowing into the oil market and the perception that demand will remain strong in the long run while supplies are tight.

“I don’t think G8 leaders can calm down this market. The market doesn’t have high hopes for a turnaround in the market.”

The G8 leaders are not in a position to reverse the trend of high prices. But it is believed a clear statement would help. The summit faces unprecedented challenges amid signs of stagflation, which had not been seen in 30 years.

“But there is a mismatch between the themes of the summit and who is participating, making it hard to actually implement any concrete and effective steps,” an onlooker on economics said.

He noted that OPEC oil producers and Southeast Asian counterparts, whose trade restrictions helped push up commodity prices, would not be joining the G8 summit. On July 06 the heads of the states that monopolize two thirds of earth’s wealth gather at Toya Lake in Hokkaido Japan to try to find reasonable solutions to climate change and price rise.

Obviously the leaders would debate upon the issues that concern their global interests and they wound focus on the profitable side of global economic activities. Mutual blaming without concrete resolutions, as before, wound mark the finale of the summit.

Imperialist Designs?

Making profits even during strife is the hallmark of capitalism. US-led anti-Islamic countries would use the forum to obtain more troop commitments for terror war in Afghanistan and Iran and support for future war strategies.

A mere show of concern by the G8 would not be enough to ease global inflation, which took the centre stage just as the world economy was starting to recover from the credit crisis. Perhaps the G-8 has to look beyond the present food and price crises for finding reliable solutions to smoothen the rise in food and oil prices. There should be a collective food security and standardized prices for a specific period.

People need justice, equal justice, total freedom and peace. But capitalism, neo-imperialism and militarism have enormously harmed the world. Humanity is against militarisation any where in the world, against any neo-liberal globalisation.

Oil is used for manufacturing of high precision weapons and hence price would always go up. Heavy militarization becomes too expensive and hence it moves the prices of other commodities also up. Poverty rate also goes up.

The main objective of G8 has been to complete the long-lasting ambitions of imperialist nations like USA and Japan. Thus, with a view to thwarting the extra ambitions of the G8, the struggle against the neo-liberalist expansion and militarization in the entire Asian region must continue and hence the protest.

The G8 nations will meet eight other countries, including China, India and Brazil, the top polluters of atmosphere followed by the USA, in an expanded Major Economies Meeting (MEM) on July 9 to look at long-term targets for climate change. There is ever chance that a few island nations would submerge in sea-waters in the near future, if climate change is not contained. And there would be more hunger deaths.

Asian Tribune