Extending Leadership and Global Governance through ‘Security & Economic Dialogue’

 The completion of the US-China ‘Security and Economic Dialogue,’ (S&ED) marked an important step in the new US Administration’s policy of engagement with the large emerging market countries.  China begins that dialogue, but it will be continued with India in the near future.  While some may see this bilateral meeting as a nascent G2, in fact I suspect it will reflect ultimately more the US policy foundation for an enhanced Gx process.

President Obama chose in his opening remarks to ‘tick off’ the key global governance questions: climate change, sustainable energy use, stability and economic prosperity, the threat of nuclear proliferation, terrorism and international human rights:

 “Today, we look out on the horizon of a new century. And as we launch this dialogue, it is important for us to reflect upon the questions that will shape the 21st century. Will growth be stalled by events like our current crisis, or will we cooperate to create balanced and sustainable growth, lifting more people out of poverty and creating a broader prosperity? Will the need for energy breed competition and climate change, or will we build partnerships to produce clean power and to protect our planet? Will nuclear weapons spread unchecked, or will we forge a new consensus to use this power for only peaceful purposes? Will extremists be able to stir conflict and division, or will we unite on behalf of our shared security? Will nations and peoples define themselves solely by their differences, or can we find the common ground necessary to meet our common challenges, and to respect the dignity of every human being?

We cannot predict with certainty what the future will bring, but we can be certain about the issues that will define our times. And we also know this: the relationship between the United States and China will shape the 21st century (emphasis added), which makes it as important as any bilateral relationship in the world. That reality must underpin our partnership. That is the responsibility we bear.”

There are short term and longer term issues to tackle.  The Joint Press release (Press Release) reveals a meeting long on commitments to collaborate but very short on practical policy achievements at this time.  While this is just the first meeting following the Obama-Hu Jintao bilateral discussions at the sidelines of the London G20 Leaders Summit, it would be fateful for these and other future bilateral encounters to fall to rhetorical diplomatic commitments.  Unfortunately these rhetorical commitments came to mark the Bush and Clinton era meetings.

Nevertheless, a notable commitment that was identified is the agreement to have the two militaries expand exchanges at all levels.  Among those exchanges the Vice Chairman of the Central Military Commission, General Xu Caihou, will visit Washington this year to meet with Secretary of Defense, Robert Gates.  The two sides also declared as positive the results of the recent Ministry of National Defense – Defense Department Consultative Talks (DCT) in Beijing.

Clearly the global financial crisis is an immediate concern to both countries.  Of even greater concern to the Chinese is the continuing solvency of the US economy and concern that soaring deficits will erode the value of the US dollar to the detriment of China which holds such massive dollar reserves.  In fact China remains the largest holder of US Treasuries today.  The concerns expressed by the Chinese leaders echoed a continuing theme – China’s continuing doubts over the US reserve currency status in the global economy:  “As a major reserve currency-issuing country in the world, the US should properly balance and properly handle the impact of the dollar supply on the domestic economy and the world economy as a whole,” said Wang Qishan, China’s Vice Premier, at an event with Treasury Secretary, Tim Geithner at the talks. Wang Qishan later expressed satisfaction over US assurances and in the Press Release the two countries committed to the following:


“First, the United States and China will respectively take measures to promote balanced and sustainable economic growth in our domestic economies to ensure a strong recovery from the international financial crisis; these include measures to increase savings in the United States and the contribution of consumption to GDP growth in China.”

Possibly most disappointing was the progress – of which there was little – in the climate change area.  Though the two countries signed and released the, “US-China Memorandum of Understanding to Enhance Cooperation on Climate Change, Energy and thre Environment (MOU) released July 28, 2009, concrete progress seemed to allude these two major carbon emitters.

Both countries resolve to pursue areas of cooperation where joint expertise, resources, research capacity and combined market size can accelerate progress towards mutual goals. These include, as set out in the NYT, article by Andrew Revkin, but are not limited to:

1) Energy conservation and energy efficiency
2) Renewable energy
3) Cleaner uses of coal, and carbon capture and storage
4) Sustainable transportation, including electric vehicles
5) Modernization of the electrical grid
6) Joint research and development of clean energy technologies
7) Clean air
8 ) Clean water
9) Natural resource conservation, e.g. protection of wetlands and nature reserves
10) Combating climate change and promoting low-carbon economic growth

But Chinese officials continued to insist that major steps must first be taken by the developed countries in order to make climate change progress possible.

So we have a promising dialogue.  However, more engagement is required.

“The Architecture of Global Cooperation”

On Wednesday July 15th, Secretary of State, Hillary Clinton gave a major speech at the Council for Foreign Relations – a major foreign policy think-tank in the United States.  It was an opportune moment for a major speech on the course of American foreign policy.  President Obama had just returned from his 4th major leadership Summit since assuming the Presidency.  And as I pointed out in a recent blog post, “Speaking of Architecture – A Concluding Obama Comment at  L’Aquila” – the President began to openly comment on the current global governance structure – in particular the Gx process – in his last news conference at the G8 L’Aquila Summit in Italy.  And, Hillary herself was preparing to undertake a trip to India – a major emerging great power in the G5 constellation of powers -China, India, Brazil, South Africa and Mexico.

In her speech, Secretary Clinton, declared that the US was determined to build this, “Architecture of Global Cooperation,” which she stated required the US to, “devise the right policies and use the right tools.”  Now what is this “Architecture ofGlobal Cooperation.”  The speech provided some hints yet remains frustratingly vague.

Clinton signaled that the new American foreign policy is going to be made up of the following approaches:

  • updating and or creating new institutions for international cooperation with partners;
  • proceeding to engage those who disagree with the US – read that immediately as North Korea and Iran;
  • ‘development’ will be elevated to a major aspect of American foreign policy action;
  • the US will better integrate military and civilian action in conflict areas – read that as Iraq and Afghanistan;
  • better leveraging of key aspects of American power  – economic power and power generally – in the service of American foreign policy.

It is evident that this Administration is promoting a new multilateral action – one which they see as multipartner rather than multipolar.  Officials have begun to use this phrase – multipartner in many speeches.  As Clinton sees it the multipartner approach :

“… will lead by inducing greater cooperation among a greater number of actors and reducing competition, tilting the balance away from a multi-polar world and toward a multi-partner world.”

Now the Secretary of State recognizes that not all countries will accept this approach and in some cases the coalition will remain a power coalition designed to constrain or deter adversaries.  But to the extent she can, she and the Administration will bring the right tools and policies in a principled but pragmatic approach to create a common-sense policy. Somehow, this vision seems an awful lot like working with ‘friend and foe’ to advance the global governance agenda.  Good to find the US willing to extend the cooperation agenda but unclear that the conflicts of interest – Russia, Iran, North Korea – are likely to remain unresolved.

What then of the architecture of global cooperation?  On the substance side it is evident that the Secretary of State opens the agenda up – she pointedly notes that the China-US bilateral – meeting later in the month in Washington is  both an economic and strategic security one with a key rising power. This is potentially a serious effort to engage the Chinese but a small suspicion remains that this is more of an inter agency battle with Treasury to reengage State in the economic arena.  We need to watch the meeting closely later this month.

Like President Obama, Secretary of State Clinton, acknowledges that the global and regional institutions built most formidably after the World War II are no longer adequate and they must be, “transformed and reformed.”   And like Obama, Clinton suggests – repeating Obama – what is needed are institutions that:

“… combine the efficiency and capacity for action with inclusiveness from the U.N. to the World Bank, from the IMF to the G-8 and the G-20, from the OAS and the Summit of the Americas to the ASEAN and APEC, all these and other institutions have a role to play.  But their continued vitality and relevance depend on their legitimacy and representativeness and the ability of their members to act swiftly and responsibly when problems arise.”

But what is that?  It can’t be all these organizations – or can it? And if it is how does the agenda move forward?  And what of the critical dimensions – effectiveness, legitimacy and representativeness.  Yet other critical dimensions –  if leaders are to be believed – include also “equality and informality”.  The vessel of the “Architecture of Global Cooperation”  has been declared but the structure and contact remain maddeningly unclear.  The time to clarify is fast approaching.

Speaking of Architecture – A Concluding Obama Comment at L’Aquila

One of the continuing issues of this G8 L’Aquila Summit is how, or if, the structure of the G8, G8+G5 and G20 process is about to be transformed. With the appearance in November last year of the G20 Leaders Summit followed by the London April G20 Leaders Summit and now with the announced September 25th Pittsburgh G20 Leaders Summit, experts and the media especially have been waiting for both the demise of the G8 and the presumed crowning of the G20 as the sole Gx forum for global leaders.

CIGI Colleagues – Andrew Cooper, Gregory Chin with the assistance of Andrew Schrumm and Chatham House colleagues Paola Subacchi with the assistance of Ruth Davis have just completed an excellent stay and fine reportage at the L’Aquila Summit at: “Tracking the G8 L’Aquila Summit” – a visit well worth taking.  But the question of architecture remains top-of the-mind question for global governance.

And it would appear to be a ‘decision not yet made’.  Notwithstanding the almost universal view that the G20 will emerge as the successor to the the now ‘illegitimate’ G8 process there remains ‘no decision.’

A number of threads remain.  The Heiligendamm Process – what was defined by the Germans as a structured dialogue – has been continued for two more years by the G8 plus G5 Leaders.  This process – now renamed the HAP (Heiligendamm L’Aquila Process) will continue a policy dialogue with a number of Working Groups with the leaders of the G8 + G5 (Brazil, China, India, South Africa and Mexico) announcing that they:


…. will review progress at the end of the first year on the basis of a substantive report to Leaders for guidance at the Summit in Muskoka in 2010. A concluding report will be presented at the French Summit in 2011. This Process, which is a policy dialogue aiming at strengthening mutual understanding in the spirit of the work already undertaken, will focus on areas of common interest to the Partners, be forward-looking and produce tangible results.

Quietly supported by the OECD Support Unit led by its director, Ulrich Benterbusch, this policy dialogue has provided a setting where these countries have worked to, “enhance trust and confidence among the dialogue partners as well as develop common understanding on global issues.” A final Report of the HDP was issued at this Summit.

But the ‘final’ architecture remains unclear.  It is evident that the Italians sought to extend the reach of the G8 core by including the G5 on day two (the Italians even added 1 – Egypt to this G5 group).  On day three an even wider network of leaders including many from Africa were included.  The Italians called this a ‘variable geometry’ calling together those countries – and their leaders – that could best address the problem – whether climate change, development or food safety.  But variable geometry or not, the core G8 remained.

Evident or not, it’s not inevitable that the G8 will be subsumed by the G20.  It may just be the accidental consequence of the sequence of the current G8 Presidency but those who have recently held that annual rotating post have generally not been enthusiastic over the prospect of G8 enlargement.  Japan has favored the informality and influence of the smaller G8 and has been concerned that enlargement will inevitably include China ending Japan’s sole Asia representation role.  Italy has favored variable geometry but retaining the G8 core.  Canada has now assumed the Presidency of the G8 and has just initiated planning for the 2010 G8 Muskoka Summit. Canada too has been cool recently to expansion.  A loss of influence is inevitably arise for Canada and other ‘smaller’ G8 countries with the expansion of the G8 to a G13 or G20.

The key to architectural change is the United States.  It would seem that a clear statement from the Obama Administration favoring one structure or the other would likely influence members of the G8 – especially those less enthusiastic over expansion.  Early in the Administration’s life, it appeared that it would review and express a view on the current global governance architecture even as early as the G8.  But following the G20 London Summit, the Administration signaled that it’s priority for the G8 and the newly announced G20 Pittsburgh Summit was outcome and collective decisions and that the Administration would take no position on the future Gx process until after Pittsburgh.

Yet the tea leaves have been stirred – if only a little – in the concluding press conference by President Obama on Friday.  Take in what the President had to say to a question clearly focused on the Gx process and future architecture:


Q President, it seems that yesterday morning you had a very spirited and lively discussion within — with the G8-plus-5-plus-1, ignited by President Lula objection to the format, to the adequacy of the G8 as a forum. And, well, I would like — what was your argument in this discussion and whether or not you have the feeling that the days of the G8 are over? And a very — a second question, but very light, after six months wheeling and dealing with these international forums — G20, NATO, and G8 — do you find it more complicated or less complicated to deal with that than with the American Congress? (Laughter.)

THE PRESIDENT: Well, the — on the second question it’s not even close. I mean, Congress is always tougher. But in terms of the issue of the Gasoline and what’s the appropriate international structure and framework, I have to tell you in the discussions I listened more than I spoke, although what I said privately was the same thing that I’ve said publicly, which is that there is no doubt that we have to update and refresh and renew the international institutions that were set up in a different time and place. Some — the United Nations — date back to post-World War II. Others, like the G8, are 30 years old.
And so there’s no sense that those institutions can adequately capture the enormous changes that have taken place during those intervening decades. What, exactly, is the right format is a question that I think will be debated.
One point I did make in the meeting is that what I’ve noticed is everybody wants the smallest possible group, smallest possible organization that includes them (emphasis added).  So if they’re the 21st-largest nation in the world, then they want the G21, and think it’s highly unfair if they’ve been cut out.
What’s also true is that part of the challenge here is revitalizing the United Nations, because a lot of energy is going into these various summits and these organizations in part because there’s a sense that when it comes to big, tough problems the U.N. General Assembly is not always working as effectively and rapidly as it needs to. So I’m a strong supporter of the U.N. — and I said so in this meeting — but it has to be reformed and revitalized, and this is something that I’ve said to the Secretary General.
One thing I think is absolutely true is, is that for us to think we can somehow deal with some of these global challenges in the absence of major powers — like China, India, and Brazil — seems to me wrongheaded (emphasis added). So they are going to have to be included in these conversations. To have entire continents like Africa or Latin America not adequately represented in these major international forums and decision-making bodies is not going to work.

So I think we’re in a transition period. We’re trying to find the right shape that combines the efficiency and capacity for action with inclusiveness. And my expectation is, is that over the next several years you’ll see an evolution and we’ll be able to find the right combination. (emphasis added)

The one thing I will be looking forward to is fewer summit meetings, because, as you said, I’ve only been in office six months now and there have been a lot of these. And I think that there’s a possibility of streamlining them and making them more effective. The United States obviously is an absolutely committed partner to concerted international action, but we need to I think make sure that they’re as productive as possible.

While the reference to UN revitalization comes as something as a surprise, and given the last effort to revise the governance structures in 2005, I would think even more frustrating – and unlikely – than the Gx reform process, it is evident that the President and the Administration is giving thought to the future shape of global governance.  Look for expansion – and possibly soon.