Declining prestige of G-20

Nitya Chakraborty

Just three days before the start of the summit of the Group of Twenty countries(G-20) at Humburg in Germany on July 7 and 8, high tensions have gripped the Brussels headquarters of the European Union and the German capital Berlin as information has percolated that the US President Donald Trump will be making a very harsh statement against Germany concerning free trade, climate change and immigration and his target will principally be the German Chanchellor Angela Merkel who is hosting the summit  this year.
The United States is a major member of the G-20 and at the earlier G-20 summit in China in 2016, President Obama and the German Chanchellor Merkel concluded discussions in a most friendly environment and the joint statement fully reflected the identity of views of the US with other members of the G-20.But this time, the situation is completely different. This is the first G-20 summit after the taking over of Donald Trump as US President on January 20 this year. Trump has known his firm opposition to the common G-20 policies on free trade, Climate change, Immigration and the refugee policy followed by most of the European countries, especially Germany and France. He has publicly rebuked Angela Merkel and gave open support to the main opponent of the current French President Macron during the recent presidential elections in France. The US President supported the Brexit and his actions and comments made it clear that he is against a strong and unified Europe.
All these factors are having its play at the coming Humburg summit as Donald Trump arrives with his big delegation of officials. Trump is not visiting any other European country excepting Poland. Massive demonstrations are planned in Humburg as also in other parts of Germany against the visit of Trump. There are separate protests by leftwing groups against the austerity measures adopted by the European governments but the main focus is against Trump who is being projected as the enemy of Germany. In such a surcharged atmosphere, political observers are wondering whether the Humburg summit will be the last united G-20 summit. The differences are so wide between the US and the members of the European Union led by Germany that it will be difficult to come to an agreed joint statement unless Trump compromises on his present positions. There is little possibility of the US President diluting his stand at this moment.
Trade is the major agenda and during preparatory meetings, the US officials at the instance of Trump insisted that the usual words of resisting all kinds of protectionism, would have to be dropped. This is the general position of Germany and other European countries as also India and China. There might be differences about the nature of protectionism but protectionism in general, is against free trade and that becomes a part of the statement. The US officials have refused to include any mention of protectionism in the statement. Further, the Us has threatened that it will consider raising tariffs on steel and other goods raising alarm in Europe and Canada. German Chanchellor has prepared retaliatory steps by taking the sanction of Parliament last week in taking any measure to meet the protectionism from the US.
During the last six months of his administration, Trump has unsettled his European allies and also Canada and Mexico due to his sharp shift from the common US polices towards trade and multilateral institutions. He has been especially critical of Merkel for his refugee policy and has termed it catastrophic. Trump advisers are constantly saying that Germany prospered due to American funds and costly exports to USA and this will be stopped under Trump. Merkel has told her European partners to be ready to fend for themselves and not expect any assistance from the US under Trump. For Merkel, it is very important for her to get across the common views of the European countries to Trump in an unambiguous manner and she has to come out as a stronger leader in her confrontation with Trump at the summit. Her rating is high now before the general elections in September and by taking a strong anti- protectionist position at the summit against Trump, she can win points in her fight against the opponent Social Democratic Party in the polls.
There is another big issue which Merkel as the host of the summit, is taking up. This relates to a big initiative to boost investment in Africa. Germany is the most attractive area for refugees who are leaving Africa due to poverty or civil wars. Germany has a liberal refugee policy. German policymakers believe that unless Africa is made economically stronger through massive private and government investments by the G-20 countries, there will be a big exodus of refugees from the continent and they will try to reach Germany first. This thinking has led Merkel to propose at the summit a “Compact With Africa” initiative that would involve G-20 nations bringing private investment, job growth and new businesses ro African countries that are implementing economic reforms. Merkel will seek Trump’s cooperation on this and this proposal is very dear to her heart. It will be seen how Trump reacts to this. So far, there has been no response from the US side.
The G-20 was formed in 1999 in the wake of the Asian financial crisis as a new forum that would unite finance ministers and central bankers from the world’s richest as also emerging economies. In November 2008, it was elevated to the level of the heads of governments. Taken together, the nations of the G-20 account for around 80 per cent of global GDP, nearly 75 per cent of global trade and about two third of the world’s population. (IPA)

Saturday, 8 July, 2017