[This is another in a series of Celebrity Blogger posts on celebrities and global affairs. Clooney has been very involved South Sudan and you can find information on the Referendum at the Munk School Portal – The Blog Master]

Celebrity activists are commonly criticized for being enthusiastic amateurs. Indeed in some cases personalities from the entertainment world do embrace issues that they know very little about. There is a tendency among these individuals to use their star power as free-lancers with little regard to either advisory or networked support.

In the top category of celebrity activist however the opposite tendency occurs. As addressed in my previous blogs (see previous guest blogger posts) the premier cluster of celebrity activists are rigorous about seeking advice from professionals. This is true of Bono and many others who have been influenced by Bono. It is also true of Angelina Jolie.

Arguably George Clooney is the most diversified celebrity activist in terms of his layers of connection. In a similar fashion to a number of other celebrity activists Clooney has a UN affiliation, albeit not as an ambassador for a UN special agency but as a Messenger of Peace.  I [Celebrity Blogger] was in India in January 2008, when Clooney showed how serious he was about this role. Although he was up for a number of Oscar nominations for ‘Michael Clayton’ Clooney was preoccupied with the issue of peacekeeping, coming to India with the UN Assistant Secretary for Peacekeeping Operations to discuss India’s contribution to this UN activity.

Akin to the most savvy of the celebrity activists Clooney uses his star power and official designation to lever access with key state officials. Foreshadowing his later success in the US (including face time with both President Obama and Vice-President Biden in October 2010), Clooney gained personal meetings with key officials on his trip to India – the Defence Secretary, officials at the foreign ministry (who even hosted a party for Clooney at the Taj Mahal hotel) and a regional Army Command Headquarters at Jaipur.

If Clooney expressed a willingness to listen the targeted focus of this and other trips has been on ending the conflict in Sudan/Darfur. He has combined with Don Cheadle in campaigning via the advocacy group Not on Our Watch. He has traveled to the crisis on frequent occasions – with among others his father (an experienced newsman) and Nicholas Kristof (the New York Times columnist who has reported experienced on Darfur/Sudan). Behind Clooney’s work stands again John Prendergast, the co-founder of the Enough Project and a former director of African affairs at the National Security Council during the Clinton administration.

Under Prendergast’s guidance Clooney has constantly ratcheted up the level of his networking. His latest move – well worth tracking as a form of innovative cyber – diplomacy is the launch of the Satellite Sentinel Project, an initiative that with the support of Not On Our Watch, Prendergast’s Enough Project, the UN Operational Satellite Applications Program (UNOSAT), the Harvard Humanitarian Initiative, Google, and Internet firm Trellon, will monitor the border between North and South Sudan in the context of this week’s pivotal referendum about self-determination for the South.

We will have to wait to see whether this initiative, combining the collection of satellite imagery, the design of a Web platform that will publicly share the images and data, the contribution of on-the-ground reports to provide context to the satellite imagery, and field reports and policy analysis to ensure that continued attention is paid, works in practice.

But one thing is already clear. Far from displaying the character of enthusiastic amateurism, this form of network power with Clooney as the star front man reveals the will and skill of a sophisticated enterprise.

A h0st of apologies to all of you that have wandered by, or targeted, this blog.  As you are aware it has been silent over the last few weeks. I want to thank my colleagues at CIGI for allowing me to blog Rising BRICSAM at their website.  But I have regained my independence and Rising BRICSAM is now back in the blogosphere.

If you’d like to search the archives – the earliest blog posts, and of course going forward, all those blog posts will be here.  If you are looking for posts from 2008 to October 2010 then you can find them at CIGI.

As for the just in time, it’s because, of course, we are just a day away from the Seoul G20 summit.  Fortunately I am here in the G20 media center in Seoul with colleagues from the Munk School of Global Affairs at the University of Toronto.  Also in attendance are colleagues from the The Stanley Foundation (TSF) and colleagues from CIGI.  And then there are the other 4,000 media that will be here at the media center starting tomorrow.

So hang on to your hats – this should be quite the ride for the next few days.  And I’ll try and report this to you.

Following the end of the Shanghai Cooperation Organization Summit (SCO), the leaders of the BRICs – Brazil, Russia, India and China met formally for the first time on June 16th.  This leaders meeting caps a series of ministerial gatherings of either the BRICs or the G5 (Brazil, Russia, India, China, South Africa and Mexico).

In the run up to the Leaders meeting there was much speculation over the Leaders’ possible statements or actions in reducing the reserve currency role of the US dollar.  But as noted by ‘Dr. Doom,’ Nouriel Roubini, Professor of Economics at the Stern School of Business at NYU, in an online piece on Forbes.com, “the inaugural summit focused primarily on forging common positions on financial regulatory reform and climate change, rather than foreign exchange rate management.”  Still the fact that these Leaders met at all is slightly stunning and adds to the overall momentum for large emerging economies collaborative efforts.  But we need to be realistic about such collaborative action.

The large emerging market powers, whether in the G5 or the BRIC gatherings, are making their collective presence known.  However, much of their focus is on the global financial crisis and the Leaders club – the G20.  The G5 and BRIC gatherings have called for coordination and have identified the G20 as the appropriate forum for such collaboration. In the Sapporo Declaration of July 8, 2008 the G5 declared:

Given current global macroeconomic imbalances, it is essential to enhance policy coordination not only among advanced economies but also with emerging market economies, including by reinforcing existing multilateral mechanism for Coordination.  The Financial G-20 is an appropriate forum for this endeavor.

And the BRIC Finance Ministers just prior the G20 Leaders meeting in London expressed their support for the G20:

We consider that the G20’s position as the focal point to coordinate with global economic and financial challenges and to lead international efforts responding to the current crisis should be consolidated.

Finally,  in their joint statement following the historic Leaders meeting, the BRIC leaders declared:

1. We stress the central role played by the G20 Summits in dealing with the financial crisis. They have fostered cooperation, policy coordination and political dialogue regarding international economic and financial matters.

2. We call upon all states and relevant international bodies to act vigorously to implement the decisions adopted at the G20 Summit in London on April 2, 2009. We shall cooperate closely among ourselves and with other partners to ensure further progress of collective action at the next G20 Summit to be held in Pittsburgh in September 2009. We look forward to a successful outcome of the United Nations Conference on the World Financial and Economic Crisis and its Impact on Development to be held in New York on June 24-26, 2009.

Too many commentators have been quick to declare the successful collective leadership either for the BRICs or the G5.  It is evident that these countries are exploring collective action but there is a long way to go before declaring these clubs a permanent presence.  Meanwhile that leadership of the emerging market countries is focused on the G20 and its attention on the global financial crisis.

Jim O’Neill, Head of Global Economic Research for Goldman Sachs, is not ready to declare decoupling dead – at least with regard to the BRICs.  O’Neill, the ‘inventor’ of the BRICs, recently sought to resuscitate the notion that the BRICs can continue to grow even after their largest export market, the US, succumbs to the Great Recession, because they rely on domestic demand.  The piece is entitled “The New Shopping Superpower:  The BRICs rely increasingly on domestic demand and can boom even if export markets like the US slow,” and was published in NEWSWEEK (March 21, 2009 in the published magazine, March 30, 2009 issue).  Indeed, Jim not only defends decoupling, he has revised his estimate of when he believes the BRICs, collectively, will outgrow, in dollar terms, the G7.  Earlier predictions by Jim argued the BRICs would collectively have a larger economy in 2035.  Now Jim, with an examination of current rates, predicts that the shift could occur as early as 2027.

Though Jim recognizes that, collectively, the BRICs are likely to grow at only 4 percent, predictions for the global economy are a decline of 1.1 percent.  Individual developed states are in much more difficult shape, with Goldman Sachs’s predictions for the US down 3.2 percent, worse for the Euro zone and a dizzying 6.1 percent decline for Japan.

Meanwhile China is predicted to grow at 7 percent this year and over 8 percent in 2010 and India at 6.6 for the same year.  As O’Neill concludes:

“Within the overall picture, there is clear evidence of major rebalancing, as BRIC shoppers account for an increasingly large share of global consumption.  When we track retail shoppers from 2004 to 2008 (using data adjusted for inflation and the relative size of national economies), it becomes clear that European and Japanese shoppers are barely contributing anything to real consumption growth.  American shoppers gradually contributed less up to 2007 before completely zipping up their wallets in 2008.  BRIC shoppers slowly contributed more, and, importantly, their contribution continued to increase into 2008, despite the collapse of the US shopper.”

Jim looks to better growth for China on the basis that China’s retail sales grew by 15 per cent in February.  Consumer prices have declined sharply providing a boost to real income for Chinese consumers.  Jim also notes that the government has announced plans to strengthen medical coverage that he, and I’m sure the government, hopes will help release the savings of the public. And then there is infrastructure spending, etc., etc., ending with the current stock market rally. Notwithstanding the lowering of current growth predictions, Jim remains optimistic over China’s growth prospects.

And he may be right, though the cascading implications of the global financial crisis and its impact on trade, investment and jobs should not be underestimated.  For instance, I note that Brazil’s economy – another of the BRIC economies – is now suffering.  A recent article in the New York Times (“Brazil’s ‘Teflon’ Leader Nicked by Slump,” by Alexei Barrionuevo, dated April 3, 2009) suggests the real economy is now “hurting”. Brazil’s GDP has fallen 3.6 percent in the last quarter of 2008 from the third, and the country lost 654,946 jobs in December 2008, with 101,748 more lost jobs in January.

I would continue to hold all bets on decoupling for the moment.

Well now that the theory of ‘decoupling’ has been assigned to the history bin as a fanciful assessment of the global economy, we need to analyze the impact of the global financial crisis on the Rising BRICSAM.  It appears to be – not good.

Most analysts have commented on the efforts most BRIC countries have undertaken to defend themselves against financial instability.  The BRIC countries have all built large surpluses of foreign reserves.  Examine the figures on foreign exchange reserves below.

• China      $USD 1.9 trillion (September 2008)         +33% change in year 2007
• Russia     $USD 485 billion (November 6, 2008)
• India        $USD 253 billion (October 2008)            +65%
• Brazil       $USD 205 billion (August 31, 2008)       +106%

These figures, by the way, come from a presentation by Prashant Pathak the managing partner of ReichmannHauer Capital Partners here in Toronto.  This week Prashant gave a marvelous presentation to  our (Jim de Wilde, Jonathan Hausmann and myself) undergraduate commerce course from the Rotman School of Management entitled, ‘Globalization, Global capital markets and the Structure of the International Political Economy’ (more on that in the future).

The point here is that each of the BRIC countries had taken steps to defend their economies.  Bitter lessons of Continue reading →

I apologize to all those known and unknown eyeballs. Unfortunaley,  not really but I am off with family to the wilds of Xinjiang, Gansu and Shaanxi. And oh yes off to Hami for the total solar eclipse. And oh yeah, the Olympics. Back with you on or about August 16th.

Whether we look at the UNSC-P5 or the industrialized G7/8, or other global governance institutions, the refrain is the same – the organization cannot get the work done given current membership. The organization neither has the economic heft, in some cases, or the diplomatic leadership, in other cases, or both, to make decisions. But constructing the path to new global governance architecture – devising membership reform – is not simple. Indeed the redistribution of power in the international system and accommodating new leadership is the key dilemma in reform. Exploring the development of G7/8 enlargement is the purpose of a paper by Timothy Shaw (his appointments span the world but currently he is at the University of the West Indies and CIGI Senior Fellow) , Agata Antkiewicz (Senior Researcher at CIGI) and Andrew Cooper (Associate Director and CIGI Distinguished Fellow) (Shaw et al.) for the economic diplomacy Project at CIGI. The paper Continue reading →